Capital Markets Summer 2020
Physical → Digital Lasting Change
I • We believe companies will increasingly invest in digital transformation and deemphasize physical capital expenditures ‒ Driven by increasing consumer demand for digital commerce, communication, and media as well as the opportunity for productivity improvement
The Digital Transformation Marches Onward
Share of U.S. Business Investment
1Q15 3Q15 1Q16 3Q16 1Q17 3Q17 1Q18 3Q18 1Q19 3Q19 1Q20
Source: U.S. Bureau of Economic Analysis and Alger. Digital investment comprises nonresidential fixed investment of intellectual property products (software and R&D) and information processing equipment. Physical investment comprises nonresidential structures and equipment (ex-information processing).
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