The office of the Chief Investment Officer of Wealth Management in Asia Pacific at UBS stated that the recent second quarter earnings season showed no signs of slowing down in spending on artificial intelligence (AI) by large technology companies. Executives emphasized that the risk of underspending is greater than overspending. As competition in the AI field among large tech companies intensifies, UBS Wealth Management expects their overall capital expenditure to increase by 47% and 16.5% in 2021 and 2025, reaching $218 billion and $254 billion, respectively. However, the overall capital expenditure intensity (capital expenditure divided by revenue) of large tech companies is still below historical peak levels. UBS Wealth Management stated that as businesses and consumers increase their utilization of AI and more complex new AI models emerge, the bank expects AI computing power (the computational resources required for AI systems to carry out tasks) to continue to grow strongly, supporting significant investments in graphics processing units (GPUs) and other chips. UBS Wealth Management believes that higher-than-expected spending on AI computing power for next-generation models could mean that there is still room for further increases in capital expenditure by large tech companies. UBS Wealth Management's calculations indicate that the increase in capital expenditure will not weaken the overall ability of large tech companies to generate strong free cash flow, as these companies seem poised to achieve close to 15-20% profit growth in the coming quarters as AI monetization accelerates. UBS Wealth Management expects the total free cash flow of large tech companies to increase from $413 billion in 2021 to $522 billion in 2025. Given the possibility of increased short-term volatility in the future, investors with low exposure to AI may consider implementing structured strategies, including put options or reverse convertible bonds, to establish a long-term exposure to this theme. Investors with high exposure to AI may consider maturity principal redemption strategies as a hedging tool.