Short-Seller Jim Chanos Warns AI-Driven Capex Surge To Boost S&P 500 Earnings Estimates

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A surge in capital expenditure related to artificial intelligence could enhance earnings per share estimates for the S&P 500 in the years 2026-27, according to short-seller Jim Chanos.

AI Capex Could Boost S&P 500 EPS

A significant rise in AI-related capital expenditure (capex) is expected to elevate S&P 500 earnings per share (EPS) estimates.

Chanos highlighted that the accounting practices for AI investments create a disparity between immediate revenue and profit recognition and the capitalization of costs. This discrepancy is anticipated to result in a profits “magic” during periods of increased capital spending, Chanos added.

These massive increases in AI-related capex estimates will also pull up S&P 500 EPS estimates for 2026-27, given the accounting mismatch for revenues/profits(immediate recognition) and costs (mostly capitalized). The profits “magic” of capital spending booms. https://t.co/vMfOAMvT3L

— James Chanos (@RealJimChanos) May 2, 2026

The boost in EPS estimates stems from the way AI-related …

Full story available on Benzinga.com

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