Is the ‘One Big Beautiful Bill ’ a Boon to Big Tech?
We explore the new tax law's implications for the artificial intelligence (AI) landscape and which companies likely stand to gain.

Key Takeaways
The One Big Beautiful Bill Act (OBBB) incentivizes and rewards companies for investing in AI infrastructure.
Large-cap growth companies may be particularly well-suited to benefit from and capitalize on this opportunity.
AI is less like a rising tide that lifts all boats and more like a wave that propels some ahead while swamping others.
“What does President Trump’s new tax bill mean for my investments?” is a common question our U.S. Growth Team has heard from clients. As large-cap growth investors, we think the recently passed OBBB Act may benefit many Big Tech companies.
However, the new law’s incentives for investments in artificial intelligence don’t guarantee that all AI-related stocks will do well. This highly disruptive technology will boost some companies and likely render others obsolete. The OBBB may accelerate this process.
What AI Investment Incentives Are Included in the OBBB?
Taking a comprehensive approach, the OBBB consists of nearly 900 pages of legislation, with a clear goal to significantly boost AI investment in the U.S.
The law aims to promote domestic semiconductor production, enhance physical infrastructure, increase research and development (R&D) investment, and support the energy needed for AI to flourish within the U.S.
This effort didn’t occur in a vacuum. Large-cap technology companies' most significant capital spending focus has been expanding computing power to support their AI technologies. This investment includes chips, cables, cooling systems, power infrastructure and networking equipment. It also involves acquiring the necessary real estate to house and integrate these elements in the large data centers required.
As a result, AI-related companies are at the confluence of powerful fundamental business and fiscal policy trends. We believe large-cap tech companies involved in AI are the bill’s undisputed beneficiaries.
We’re not suggesting that AI-related stocks suddenly become a “buy” thanks to the OBBB. The current AI-fueled stock rally dates to the public launch of ChatGPT in November 2022 during the Biden presidency. Since then, the hundreds of billions of dollars companies have spent on AI-related investments haven’t depended on special tax treatment or government incentives.
In simple terms, AI is a compelling technology that attracts significant business investment. The OBBB is building on this ongoing trend and giving it a powerful new boost.
What OBBB Tax Changes Support AI Investment?
The late, great investor Charlie Munger famously said, “Show me the incentives, and I’ll show you the outcome.” The OBBB incentivizes corporate spending on R&D and domestic investment in AI through changes in tax law.
Specifically, the OBBB increases the investment tax credit for building semiconductors and manufacturing semiconductor equipment. Additionally, it allows companies to deduct their investment expenses all at once, right up front, instead of in small amounts over time.
Without getting into the nitty-gritty of tax accounting, we can illustrate the concept with a simple example using some back-of-the-napkin figures. Imagine a new data center costs $5 billion, and the corporate tax rate is 20%. Under the OBBB, the company that invests this amount in this new facility can immediately deduct the entire $5 billion. A 20% tax rate results in savings of $1 billion on this year’s tax bill.
These tax changes flow directly into corporate profits. The $1 billion not paid to Uncle Sam represents cash flow retained by the company.
Before the OBBB, companies could deduct only a fraction of their capital investments and R&D spending from their taxes each year. Different parts of a capital project received different tax treatments to complicate matters further. As a result, the corporate tax benefits became diluted and spread over many years.
After experiencing a recent period of high inflation, you instinctively understand that a dollar today holds more value than a dollar in the future. There’s no need for an Excel spreadsheet to see this!
By simplifying and prioritizing tax benefits, the OBBB strongly encourages spending on AI right now. If Charlie Munger is right, these incentives will lead to significant outcomes.
Let's examine some real-world data. We recently received the second-quarter 2025 earnings reports from the major AI "hyperscalers." These are their projected AI-related capital expenditures for all of 2025:
Alphabet, $85 billion.
Amazon.com, $72 billion.
Meta Platforms, $68 billion.
Microsoft, $80 billion.
The federal corporate tax rate is unchanged under the OBBB at 21%. Using rough estimates, these companies are expected to save between $14 and $18 billion on their tax bills for calendar year 2025 due to this issue alone. Zion Research Group estimates that the four firms would realize more than $55 billion in combined tax savings for this year.1
What Industries May Benefit from OBBB’s AI Stimulus?
While hyperscalers benefit from the OBBB by being able to expense their investment costs immediately, the new tax law's benefits aren’t limited to the largest technology companies. Spending will ultimately flow to companies further down the AI value chain.
When a hyperscaler orders a new data center, the demand created extends far beyond just the advanced chips needed for heavy computational tasks. It includes those who build and maintain the physical infrastructure, the utility providers and the real estate required to house the data center.
There’s also a significant surge in demand for copper due to its ability to dissipate heat and conduct electricity, which is essential for nearly every aspect of modern technology. You can also thank the energy demands associated with AI for the resurgence of nuclear power.
Do Stimulus Provisions of the OBBB Conflict with Other Economic Policies?
Trade policies are also part and parcel of the administration’s approach to promoting AI investment.
For example, the early August announcement of 100% tariffs on imported chips was meant to encourage foreign-based semiconductor foundries to invest in new production capacity in the U.S. Additionally, the revenue generated by these tariffs aims to offset the fiscal budget impact of lower tax revenues. So, in this sense, the tariff and tax policies align.
However, it’s important to note that some policies are working at cross purposes. The OBBB is meant to stimulate the economy, but tariffs function as a tax on consumers.
For instance, if the prices of imported coffee beans or avocados rise, a larger portion of our paychecks will go toward groceries, leaving less money available for other purchases. Additionally, the president’s positions on taxes, tariffs and immigration (contributing to a smaller labor pool) may worsen inflation.
The OBBB’s corporate tax and spending incentives may boost stocks in the short run. A presumably more lenient regulatory environment should also support corporate profits. Regardless of party affiliation or opinions about the OBBB, we believe the U.S. economy's ultimate success depends on businesses' ability to thrive and succeed.
Which Industries Face Challenges Under the OBBB?
The new tax law also has implications for other sectors of the economy and markets.
On one hand, the OBBB helps small companies because they typically rely more on debt financing than large companies do. Tax changes regarding how companies account for interest expenses should benefit small business earnings.
On the other hand, health care providers/insurers, electric vehicle (EV) makers and alternative energy providers face various challenges under the new tax regime.
For example, the OBBB eliminates the EV tax credits that supported vehicle sales. This will likely weigh on EV manufacturers and parts providers. However, the U.S. makes up only about 10% of the global market for EVs, so equipment providers may continue to perform well.
What Matters More: Innovation or Market Hype?
AI can be as economically and socially transformative as flight or the internet. However, despite the utility of flight, airlines tend to be poor businesses. Similarly, the dot-com boom was eventually followed by the dot-com bust.
The reality is that having “AI” in a name or business plan doesn’t guarantee success. Today's AI hopefuls face an incredibly competitive landscape. Therefore, careful analysis and security selection will be vital to investment success in this area over time.
The inflation implications of current tax and trade policies mean that corporate pricing power remains crucial. Innovation is one way companies can justify higher prices and defend profit margins. Firms with flexible supply chains and better management will likely do better under the current trade regime.
We’re in our fourth or fifth presidential administration as an investment team. So, while we’re always mindful of tax and tariff policies, they don’t ultimately determine our investment decisions. Our goal is to invest in the companies we believe are the best, regardless of economic or political conditions.
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Jonathan Weil, “Cash Windfall from Trump’s Tax Law Is Starting to Show Up at Big Companies,” Wall Street Journal, August 4, 2025.
References to specific securities are for illustrative purposes only and are not intended as recommendations to purchase or sell securities. Opinions and estimates offered constitute our judgment and, along with other portfolio data, are subject to change without notice.
The opinions expressed are those of American Century Investments (or the portfolio manager) and are no guarantee of the future performance of any American Century Investments' portfolio. This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.
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