The AI boom is reshaping the Australian economy, and with it the assumptions that underpin every business valuation.

Key considerations for valuers, business owners and advisers:

• ABS March Quarter 2026 data records a 96.1% increase in Information Media and Telecommunications investment, a 6.5% increase in total private capital expenditure and an 18.1% increase in investment in equipment, plant and machinery.
• The RBA has observed that private business investment is much stronger than expected, largely driven by investment in data centres, and cautioned that this could exacerbate capacity pressures and skills shortages in other parts of the economy.
• Higher inflation expectations flow through to the neutral rate, which anchors the risk-free rate, the cost of capital and therefore every income-based valuation.
• Data centre construction competes with housing, transport, defence and energy projects for the same finite pool of skilled labour, driving up wages, construction costs and project delivery times.
• Markets value expected future cash flows, not history. Historical results may be indicators of future maintainable earnings, they are not the answer.
• The greatest valuation risk today is not applying the wrong methodology, but applying the correct methodology using assumptions that no longer reflect the economic environment.

Are your valuation assumptions still reflecting the economic environment you are operating in?