LLM Token Spending Index Turns Down in May, Signaling Potential End of AI Hardware Cycle

According to Beating, macro strategist Andreas Steno Larsen recently warned of a downward turn in the Silicon Data LLM Token spending index, which tracks average payment per million tokens across the market. The index peaked in late May 2026 after climbing sharply earlier in the year. Larsen highlighted that token pricing is a core indicator for the entire AI infrastructure investment cycle; a continued decline could mark the end of current spending on memory chips, hardware, and data center construction.

The shift reflects a broader change in enterprise spending attitudes. After early phases of unchecked spending and internal competition over token consumption, major tech companies including Microsoft and Amazon have begun tightening usage limits and halting related projects as high token bills failed to deliver proportional business returns.