Not Memory. Not Energy. This Is the Biggest Bottleneck in Artificial Intelligence, and These Are the Companies That Can Benefit.
There’s a lot that goes into building new AI data centers. Companies need to secure a site, ensure it can supply it with enough power and water to run thousands of servers and keep them cool, and build the structure itself. Only then can it start installing racks full of AI chips and networking equipment.
As the industry looks to build as fast as possible to support the growing demand for AI computing, it’s faced several challenges. Ensuring there’s enough power to run each data center is a challenge. Meanwhile, wafer shortages have impacted the entire semiconductor industry. Memory chips have been in particularly short supply, as the three biggest memory chipmakers hesitated to expand production capacity, fearing another big cyclical downturn.
Despite the supply chain challenges for building new data centers, hyperscalers and other AI data center companies could face an even bigger bottleneck, according to the CEOs of Broadcom (NASDAQ: AVGO) and Intel: capital. Long lead times and massive price tags for data centers means capital constraints could be holding back some companies from building as fast as they want.
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