WSS: More concerns around AI infrastructure build-out play out in investments, legal action; more leasing and builds
The past week saw more activity in the emerging neocloud space. NVIDIA made a $2b investment in CoreWeave as it continues to provide financial support for its ecosystem of service provider delivery partners. The move, not surprisingly, raised more questions about ciruclar financing and inorganic demand. NVIDIA CEO Jensen Huang has dismissed these views as ridiculous and stands by his view that demand is healthy and moves like this are meant to provide the finanical support necessary for these unprecedented infrastructure build-outs. Meanwhile, the skepticism continues to be out there and a class-action lawsuit has emerged that alleges CoreWeave misled investors about risk around data centre supply partners. We take a closer look at CoreWeave’s data centre strategy, and from an industry perspective at least, do not see anything out of sorts. The voices are getting louder out there, but not all the handwringing stands on solid footing. The sector continues to see signs of AI growth, which is translating into infrastructure expansion. Anthropic is reported to have raised its revenue growth projections again, while sharing some data points about what this means for data centre and compute building and procurement.
Another trend we have been closely tracking has been new company formation in the data centre space. The push for land and energy resources has drawn in real estate firms and investment funds with holdings that can be used for development. The new operating platforms bring in capital, data centre expertise and hyperscale backgrounds to pursue the growing addressable market. The latest company to enter is LightHouse Data Centers and it brings these elements together, targeting a number of undisclosed locations in the southeast US, with RFS dates later in the year.
Leasing is another area that is a solid indicator of the overall demand profile. In the past week, PowerHouse Data Centers confirmed a hyperscale lease in NoVA that could be a hyperscale cloud, neocloud or both, while TensorWave confirmed intentions to enter into a pair of multi-MW leases with TECfusions in a couple of US markets.
There was also a significant amount of building and expansion activity in APAC. Digital Edge confirmed its 500MW AI-ready campus build in Jakarta, Indonesia, while Iron Mountain broke ground on an 85MW facility in Mumbai, India and NTT GDC signed a PPA for a large hyperscale build in Bangkok, Thailand.
Finally, the end of the month saw us analyze some of the more noteworthy trends in the space. We looked into new company formation, as mentioned above, focusing in on why the pre-development stage is attracting more entrants, and we have additional data points on AI infrastructure growth and its make-up. We also look at some of the energy partnerships that hyperscalers have engaged in, especially on the nuclear side, while looking at how behind the metre solutions are developing momentum. This continues to be top of mind and we continue to see signs that on-site energy deployments are moving off the drawing board and going live.
or