Lead idea
Hyperscalers as downside-protected AI play
The bull case made for hyperscalers (Google, Amazon, Microsoft) was that their structured contracts offer limited downside and a high return on capital in a good outcome. David Orr (founder of Militia Capital) made the case on Monetary Matters with Jack Farley’s “Too Much Compute: Why This Top Hedge Fund Manager Believes AI is Heading for a Massive Oversupply”, aired 11 November 2026. The reasoning given was that contracts lock in around half their capacity at roughly 35% returns, making them largely insulated unless software companies go bankrupt en masse.