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StocksMedium•18 April 2026•

1 min read

AI Compute Rationing Drives iShares Software ETF to Best Weekly Performance in 25 Years

Key Facts

1AI companies are rationing compute power, shifting investor focus back toward traditional software firms.

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1 additional source confirmed this story

Financial markets are witnessing a significant shift in investor sentiment as AI companies begin rationing compute power due to high costs and resource scarcity. This trend has redirected capital flows toward traditional software firms with established business models. Consequently, the iShares Expanded Tech-Software Sector ETF (IGV) recorded its best weekly performance in 25 years, signaling a major rotation in market leadership. Analysts suggest that the scarcity of AI infrastructure is currently acting as a tailwind for established software giants like Microsoft and Oracle. This sectoral rotation marks a new phase in the IT cycle, shifting focus from pure infrastructure to software applications. This momentum is expected to persist as long as cloud computing costs remain a primary challenge for emerging AI ventures.