Weekly Update: The AI “Bubble” Isn’t Bursting — It’s Expanding

Talk of an AI “bubble” continued to shake up the market this week, with the latest example being the custom AI chipmaker Broadcom.

The company reported an outstanding fiscal fourth quarter earnings report yesterday, besting Wall Street’s estimates thanks to a surge in AI chip sales.

Broadcom brought in record revenue of $18.02 billion and $8.5 billion in profit, compared to $4.3 billion a year ago.

Looking ahead, the company expects its AI chip sales surge to continue into the first quarter and reach $8.2 billion, trouncing analysts' expectations for $6.9 billion.

Custom AI chips like what Broadcom makes are in growing demand by top firms like Google, and analysts estimate they’re poised to take 25%-30% of the accelerated computing market by 2030.

Still, shares of Broadcom pulled back along with the broader market today as investors continue to worry about an AI “bubble.”

However, when I hear the word “bubble” — especially in the context of the AI buildout — my ears perk up.

Here's why: Bubbles don't just pop... first, they inflate. And that expansion phase? That's where life-changing wealth gets created.

The Great AI Expansion of 2026

Take a look at this chart from Bespoke Investment Group. It compares two pivotal moments in tech history…

Source: Bespoke Investment Group

The blue line tracks the Nasdaq after Netscape's release in December 1994 — the moment the internet became accessible to everyday people.

Notice how it actually took years for the dot-com bubble to truly inflate. And the biggest gains didn't come at the beginning. They came at the end, right before the peak.

The red line shows the Nasdaq's performance since ChatGPT's release in November 2022 — when AI technology became available to the masses.

As you can see, the pattern is nearly identical to the one formed during the dot-com expansion.

If this correlation holds (and I believe it will), we're approaching the most profitable phase of the AI boom.

The AI Implementation Wave

But here's the key: not all AI stocks will participate in this rally equally.

The biggest winners won't be the infrastructure plays — the chip makers, data center builders, and power suppliers. Those companies already had their run.

The next wave will be AI Implementation stocks.

These are companies actually applying AI technology to transform industries, from healthcare and finance to manufacturing and logistics.

In other words, they're taking what's been built and putting it to work in the real economy.

That's where I expect the explosive growth will come from in 2026.

In the coming year, I expect we’ll see a blow-off top that could hand us outsized gains from fresh Blue Spike setups.

Which is why we’re targeting a minimum of 5 AI plays that will triple or more in 2026.