AI’s mega stock deals raise specter of more shares than buyers

A flood of new shares from companies looking to fund their artificial intelligence ambitions is raising questions on Wall Street about whether there will be enough buyers to soak them all up and what this pile of fresh equity will mean for stock prices more broadly. Initial public offerings from Space X, Anthropic and Open AI in the coming months could add close to $4 trillion in market capitalization to US exchanges, according to data compiled by Bloomberg. Already, the Space X deal has drawn more orders than shares available in the filing. Meanwhile, Alphabet Inc. is planing to raise $85 billion next quarter by selling stock, mostly into the open market, a move that could be followed by other technology giants in need of cash for AI data centers. “This is something that we haven’t seen in such a scale and in such a short time,” said Ano Kuhanathan, head of corporate research at Allianz Trade. “It’s a huge supply event.” The sellers seemingly have a lot going for them at the moment. AI investments are booming, spurring strong revenue growth. Chipmakers are soaring, with the Philadelphia Stock Exchange Semiconductor Index on pace for its best year since 2003 with an 74% gain. Even old-school tech companies like Cisco Systems Inc., Nokia Oyj and Dell Technologies Inc. have caught a bid from AI enthusiasm. Of course the timing could turn out to be less than ideal, as investors are starting to question if the rally has gone too far. The Nasdaq 100 Index sank 4.8% on Friday, its worst session in over a year. A report that Meta Platforms Inc. is considering raising tens of billions in a stock offering sent its shares down 5.5%. Still, Wall Street pros are confident the demand ultimately will be there when those new shares are available. “There is plenty of capital available to absorb not just this year’s IPOs, but also primary stock offerings by already public companies in need of cash to build out AI,” Nicholas Colas, co-founder of DataTrek Research, wrote in a note to cli