The AI-driven datacenter development frenzy reveals no indicators of slowing, however neither do issues that the entire edifice might collapse below the load of its personal hype and mounting funding calls for.
Moody’s 2026 Outlook report on the worldwide datacenter market, seen by The Register, forecasts enterprise as standard, with demand for server farm capability persevering with to rise in assist of AI, cloud computing, and web companies.
The monetary companies biz estimates no less than $3 trillion in funding is required to maintain tempo with the projected degree of capability enlargement between now and the tip of the last decade. This covers the price of buildings, the IT infrastructure, and the ability required to maintain the lights on.
Nonetheless, the report flags worries over energy grid constraints and development bottlenecks, warning that demonstrating precise income technology will grow to be “more and more necessary within the AI ecosystem” to silence rising chatter about an “AI bubble.”
Query marks over sustainability are hardly new. McKinsey & Firm warned in May 2025 that massive sums are being invested in AI on demand forecasts amounting to little greater than educated guesswork.
MIT researchers claimed 95 % of enterprise organizations had seen no return from their AI efforts up to now, and Moody’s itself says round offers involving firms like OpenAI and Microsoft are spooking investors.
Capital spending by six hyperscalers within the US – Microsoft, Amazon, Alphabet, Oracle, Meta, and CoreWeave – approached $400 billion in 2025 and is on monitor to hit $500 billion in 2026, then $600 billion in 2027. A chart in Moody’s report reveals whole international funding peaking in 2029, earlier than declining in 2030.
New datacenter growth faces rising headwinds, primarily entry to energy in most markets, with utilities and energy turbines arduous pressed to fulfill surprising electrical energy demand surges.
Moody’s additionally notes that local opposition to new builds has elevated in some markets, typically on account of public issues about their consumption of electricity and water, plus the impact on utility bills.
Nonetheless, areas with “supportive legal guidelines” will proceed to draw growth, with some governments tweaking regulatory frameworks to encourage AI datacenters. The UK introduced “AI Growth Zones” with streamlined planning processes final yr.
Because the dangers mount, builders are coming below rising strain from shoppers to shorten development schedules in order that hyperscale tenants can add new capability as quickly as attainable.
However this collides with points together with excessive demand for expert labor, constructing supplies, and important tools, driving up development prices.
Some tenants at the moment are prepared to shoulder supply dangers they beforehand averted, together with exempting energy and utilities availability from completion necessities, the report claims.
On these circular deals, Moody’s notes that OpenAI has signed sizeable contracts for gigawatts of recent datacenter capability and different property whereas making an attempt to develop its income base.
Most financing for these property depends on long-term leases with hyperscalers like Microsoft or Oracle, however “OpenAI’s rising presence within the AI ecosystem poses a rising credit score threat relying on its success,” the report states.
OpenAI suffered a net loss of $11.5 billion or more through the quarter to September 30, 2025, as The Register reported. ®
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