The Cloud 2.0 era has meant new opportunities for other players to step up. That’s playing out in the stock market, where hardware tech stocks have outperformed software tech stocks by 30 percentage points this year, writes BI’s Matthew Fox.

Nvidia is the most obvious example. It’s the market’s golden child and is close to catching Microsoft as the most valuable company in the world.

But it’s not the only one. Chipmaker Broadcom saw its stock explode this week, adding to an impressive year that’s seen its shares up roughly 60%. Now it could be the next $1 trillion company.

One of the biggest names in finance is all-in on the hardware, too. Private-equity giant Blackstone is betting big on data centers.

In April, CEO Steve Schwarzman said the firm has a $50 billion portfolio of data centers, with plans to double it. Blackstone President Jon Gray has previously pegged the data-center market at growing to a trillion dollars in the next five years.

All this is not to say that software has lost its luster. After all, a gym is only valuable if there are people looking to use it.

There are plenty of valuable companies in the space with high ceilings (see: OpenAI). But those high-flying AI models also come with controversy (see, again: OpenAI).

So yes, hardware might be boring. But for investors, boring can be good.