Analyst Gene Munster says the AI stock sell-off may be a buying chance, not a turning point

what happened

AI stocks have come under renewed pressure as investors worry that political uncertainty could slow data center construction and disrupt the sector's huge infrastructure spending. According to Stocktwits, Gene Munster of Deepwater Asset Management argues the market is missing the bigger picture. In a recent note, he said infrastructure growth may slow in the near term, but the long-term opportunity is largely intact, and he sees the recent pullback as a chance to buy rather than a sign of a fundamental change.

Munster compares the current sell-off with the turbulence of early 2025, when China's DeepSeek unsettled investors. This time, he thinks political uncertainty and possible data center moratoriums could hit growth harder, particularly in 2027 and 2028. He estimates AI adoption is still below 1% across the global digital economy and well below that in physical AI. "With that much runway still ahead, any data centers delayed by the current political environment will ultimately still need to be built," he wrote.

Beyond infrastructure, Munster highlights personal AI agents, enterprise software and physical AI. He cites about 20 million daily users for personal agents, versus roughly 3.7 billion across Meta Platforms Inc. (META) platforms, and says companies spend around $25 per employee monthly on AI compared with nearly $700 on traditional enterprise software. In after-hours trading on Friday, SPY gained 0.17%, QQQ rose 0.21% and DIA edged up 0.06%.

why it matters

The note matters for AI-linked stocks because it frames the sell-off as a question of timing for data center spending rather than a break in demand. These are one analyst's forecasts, not confirmed outcomes, and Munster himself warns that not every AI company will emerge as a winner.

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