So Morgan Stanley just dropped a number that’s bigger than most countries’ GDP: $16 trillion. That’s how much they think AI could add to S&P 500 companies’ market value. To put that in perspective, that’s like adding another entire U.S. stock market on top of what we already have.
Here’s the deal: Stephen Byrd, Morgan Stanley’s analyst who apparently has a crystal ball (or at least some really good spreadsheets), says S&P 500 companies could rake in about $920 billion annually from AI. Not total, not over a decade – every single year.
Now, before you start planning your early retirement, let’s break this down like we’re explaining it to your cousin who still thinks Bitcoin is a type of arcade token.
The Math That Makes Wall Street Swoon
Morgan Stanley’s research suggests that 90% of jobs will be touched by AI in some way. Not replaced – touched. Think of AI as that overly helpful coworker who’s actually good at their job. Sometimes they’ll do the work for you, sometimes they’ll just make you way more efficient at doing it yourself.
The benefits come from two flavors of AI: the software kind (“agentic AI” – yes, that’s really what they call it) and the robot kind (“embodied AI”). The software version is apparently going to have a bigger impact because, let’s face it, it’s easier to install an app than to convince your boss to buy a robot.
Winners and Losers in the AI Casino
Not every sector gets to ride this gravy train equally. Consumer staples, real estate, and transportation could see savings that are literally bigger than their entire 2026 expected profits. That’s like finding a $20 bill in your pocket when you only had $15 to begin with.
Meanwhile, tech hardware and semiconductor companies – you know, the ones actually building the AI – might see more muted effects. It’s the classic “selling shovels during a gold rush” situation, except apparently the shovel sellers aren’t getting as rich as everyone thought.
The Reality Check
Here’s where your skeptical friend (that’s me) chimes in: This $920 billion figure assumes full adoption. That’s like assuming everyone will immediately switch to electric cars the moment they’re available. We all know how that goes.
Morgan Stanley admits this could take years to achieve. But they’re also saying the long-term opportunity could be “multiples” of that $13-16 trillion when you look beyond just the S&P 500. So either they’re really onto something, or we’re all collectively drinking some very expensive Kool-Aid.
The Bottom Line
With about $3 trillion expected to be spent globally on AI infrastructure through 2028, someone’s betting big that this isn’t just hype. Whether that someone is brilliant or just really good at convincing people to part with their money? Well, that’s the $16 trillion question.
One thing’s for sure: if Morgan Stanley is right, we’re not just witnessing a tech revolution – we’re watching the biggest wealth creation event in modern history unfold in real time. No pressure, AI.