U.S. vs. China AI spending gap widens
Watch on YouTube ↗  |  February 10, 2026 at 19:57 UTC  |  4:09  |  CNBC
Speakers
Deirdre Bosa — Tech Correspondent, CNBC
Kelly Evans — Anchor, CNBC

Summary

  • A massive divergence has emerged in market sentiment regarding AI: In the US, AI breakthroughs are triggering sell-offs in Software and Financials (fear of displacement), while in China, similar breakthroughs are fueling rallies in Media and Gaming (viewed as productivity tools).
  • US Big Tech is projected to spend over $500 billion on AI CAPEX this year, compared to just $70 billion by Chinese tech companies.
  • The market is beginning to question the capital efficiency of US AI spending, as Chinese firms (like ByteDance and those using Huawei chips) are shipping competitive models at a fraction of the cost.
Trade Ideas
Ticker Direction Speaker Thesis Time
SHORT Deirdre Bosa
Anchor/Reporter, CNBC Tech Check
A startup called Altruist launched an AI-powered tax planning tool that does in minutes what advisors charge thousands for. The speaker notes, "That is all the market needs right now to reprice an entire sector," specifically citing Schwab selling off. The market views AI as a deflationary force for professional services. If AI commoditizes high-margin advisory and tax planning tasks, the "moat" of traditional brokerages and wealth managers erodes, leading to margin compression and customer churn. Negative sentiment is currently dominating this sector; any new AI fintech announcement acts as a catalyst for selling incumbents. The startup (Altruist) fails to gain adoption, or incumbents like Schwab successfully integrate similar AI tools to defend their turf. 0:31
LONG Deirdre Bosa
Anchor/Reporter, CNBC Tech Check
"In China, breakthroughs are being priced exactly the opposite as an opportunity." A new video model from ByteDance fueled a rally in media and gaming stocks, whereas similar news from Google caused a sell-off in the US. Investors in China view AI as a supply-side enabler that lowers content creation costs (CAPEX reduction) for gaming and media giants, rather than a competitive threat that replaces the companies themselves. Contrarian Long. The market is rewarding Chinese tech for AI integration, creating a divergence trade against US counterparts. Regulatory crackdowns by the CCP or US sanctions on chip hardware slowing down model development.
SHORT Deirdre Bosa
Anchor/Reporter, CNBC Tech Check
"The software sector as a whole is getting decimated because every AI breakthrough here is being seen as a threat." Second-order thinking suggests that if AI can write code or automate enterprise workflows (like the Monday.com example mentioned), the "seat-based" pricing model of SaaS companies is in danger. The market is pricing in terminal value risk for software firms that don't own the underlying model. Momentum Short. The narrative has shifted from "AI benefits Software" to "AI replaces Software." Oversold bounce if earnings show AI is actually increasing seat retention.
WATCH Deirdre Bosa
Anchor/Reporter, CNBC Tech Check
US Big Tech is spending $500B+ on AI, while China spends $70B but still ships competitive models (like GLM on Huawei chips). The market is asking, "What if you don't need to spend that much?" If Chinese firms prove that competitive Frontier Models can be built cheaply, US Hyperscalers may face a de-rating due to massive capital inefficiency and ROI concerns. Watch for CAPEX guidance. If efficiency doesn't improve, the "spend at all costs" narrative may break. US models prove vastly superior in capabilities, justifying the spend.