Data Center Boom: JP Morgan's $5 Trillion Forecast Sparks Competition in AI Growth

Data Center Boom: JP Morgan's $5 Trillion Forecast Sparks Competition in AI Growth

Global data center investments could soar to $7 trillion by 2030, enabling the construction of up to 20 GW of capacity annually—transforming energy infrastructures worldwide.

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Forecasts indicate that global spending on data centre infrastructure may reach between $5 trillion and $7 trillion from 2026 to 2030. JP Morgan anticipates a base-case annual capital expenditure of $1 trillion, while McKinsey suggests that actual spending could exceed these estimates. This investment scale is noteworthy, especially given that Bank of America highlights the cost of constructing one gigawatt (GW) of data centre capacity at approximately $50 billion.

In 2025, a significant network of financing agreements will be established, with major players like OpenAI, Oracle, and SoftBank pledging $500 billion to their Stargate project. CoreWeave's recent $14 billion deal with Meta for computing resources illustrates a growing trend of inter-company funding. Despite OpenAI’s anticipated $20 billion in annual recurring revenue, its undertaking of a $1.4 trillion investment over the next eight years raises concerns about the sustainability of its funding.

Meanwhile, companies such as Meta, Microsoft, Amazon, and Alphabet are expected to utilize around $500 billion in free cash flow for their AI investments. Morgan Stanley projects that data centre capital expenditures could approximate $3 trillion by 2028, with about half potentially supported by hyperscalers' cash flows. Notably, Meta's Hyperion Data Center in Louisiana has successfully raised $30 billion through a special-purpose vehicle in collaboration with Blue Owl Capital.

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