TS Lombard Sees Three Risks to U.S. Earnings Growth in 2027

TS Lombard sees three forces that may slow U.S. corporate earnings growth in 2027: reduced AI-related capital spending, a fading boost from rising energy prices and higher wages.

The firm does not view the current AI boom as a repeat of the 1990s productivity surge. It says productivity gains have mainly reflected cyclical factors, while most AI-related revenue still comes from recycled capital spending.

As the industry commoditizes, AI leaders may find it harder to sustain supernormal returns. TS Lombard also says the technology’s broader benefits could reach workers as well as companies, reducing profits’ share of gross domestic product.