A Data-Center Crunch is Coming

Live updates

1. 1h ago

   Data-Center Power and Chip Crunch Hits AI Buildout

   The artificial intelligence industry faces a severe data-center power crunch and chip supply chain constraints as energy demand surges. Morgan Stanley reports that Nvidia and Broadcom remain shielded from these power bottlenecks impacting the broader chip supply chain. Meanwhile, Lumentum CEO Michael Hurlston stated in Tokyo that the company cannot meet about 70 percent of demand for some products through next year, and its AI optical components are sold out through 2029. In South Korea, refiners like SK Innovation are leveraging technology to expand into immersion cooling for AI data centers amid global base oil shortages.

   Why it matters

   Rapid artificial intelligence infrastructure expansion is straining global energy grids and manufacturing supply chains, forcing companies to seek alternative power sources and cooling technologies. Grid delays and insufficient electricity supply threaten the deployment of advanced computing facilities. Equipment providers and component makers face unprecedented backlogs as tech firms race to build out capacity.

   What is confirmed

   • Morgan Stanley reports that Nvidia and Broadcom are shielded from the data-center power crunch affecting the chip supply chain.
   • Lumentum CEO Michael Hurlston stated in Tokyo that the company cannot meet about 70 percent of demand for some products through next year.
   • South Korean refiner SK Innovation is expanding into immersion cooling for artificial intelligence data centers amid global base oil shortages.

   Still unconfirmed

   • Firmus dropped its bid to list on the Australian Securities Exchange, leaving its data center plans to be funded through private markets.
   • Oliver Curtis' bid to float Firmus for $44 billion has fallen over.

   What to watch next

   • Updates on whether additional chip and hardware suppliers can shield themselves from power constraints
   • Developments regarding grid deployment strategies and on-site energy asset integration for data centers
   Sources used for this update (15)

   1. WSJ — A Data-Center Crunch is Coming
   2. Forbes — AI Is Raising Energy Demand. Markets Need Better Rules, Not Good Intentions.
   3. Reuters — Nvidia, Broadcom shielded as AI power crunch hits chip supply chain, says Morgan Stanley
   4. Quartz — Morgan Stanley says Nvidia and Broadcom are shielded from data-center power crunch
   5. Energy Institute Blog — Buying Time, Burning Gas
   6. Yahoo Finance — The AI Buildout Needs Power It Cannot Get: 4 Energy Stocks Already Have It
   7. TheStreet Pro — AI Needs Somewhere to Plug In: 7 Stocks That Have the Power
   8. Fast Company — The next competitive advantage is infrastructure
   9. Yahoo Finance — Morgan Stanley: Nvidia, Broadcom shielded from data-center power crunch
   10. www.cnbc.com — Amazon overhauls devices with pricier Alexa tablet, dumping ...
   11. www.jll.com — How to approach the coming data center power crunch - JLL ,상업용 부동산 및 자산 투자
   12. pulse.mk.co.kr — Middle East supply crunch fuels base oil boom in South Korea
   confidence 95%