AI wasn’t the biggest engine of U.S. economic growth in 2025

Artificial intelligence (AI) has been touted as the driving force behind the U.S. economy’s growth in recent years. However, recent analyses suggest that the role of AI in economic expansion may be overstated. While AI has certainly influenced market valuations, investments, and GDP, a closer look reveals that consumer spending remains the primary driver of economic growth.

According to a report by MRB Partners U.S. economic strategist Prajakta Bhide, consumption was the most significant contributor to U.S. GDP growth in 2025, with AI-related capital expenditures coming in second. Bhide’s research shows that while AI investments did contribute to GDP growth, the impact is smaller than previously believed. Adjusting for imports of high-tech equipment, AI-related investments added around 90 basis points to real GDP growth, accounting for about 40% of the average growth over the period.

It’s worth noting that investments in software and computers, rather than data centers, were the most significant contributions of AI to GDP growth in 2025. Bhide’s report challenges the popular narrative that the U.S. economy would falter without AI, suggesting that while AI did boost GDP growth, the overall impact is more modest than commonly assumed.

Bespoke Investment Group also weighed in on the topic, dispelling notions of AI’s outsized contribution to GDP growth. Their analysis showed that AI spending accounted for just 15% of quarterly GDP growth in the second and third quarters of 2025, with a share of overall GDP of less than 5%.

Looking ahead, Bhide expects consumer spending to remain a key driver of economic expansion in 2026, despite slower income growth and increasing wealth concentration among top earners. She believes that fiscal support, AI investments, Federal Reserve rate cuts, and a stabilizing U.S. unemployment rate will further support economic growth in the coming year.

In conclusion, while AI has certainly played a role in shaping the U.S. economy, its impact may not be as significant as previously thought. Consumer spending remains the backbone of economic growth, and future developments in AI investments and other factors will continue to shape the economic landscape in the years to come.