Bernstein analysts expect data center construction delays and cancellations through 2027 due to power constraints, keeping AI capacity tight.
Bernstein analysts warned that the global data center pipeline faces widespread construction delays and cancellations that will continue until after 2026. Power and supply chain constraints are the main bottlenecks, forcing developers to reassess projects amid rising costs and extended lead times.
Demand for AI workloads keeps driving capacity needs, which means the gap between supply and demand will remain tight. The long-term outlook is constructive once new power sources come online, the analysts said. For now, the pace of new deliveries will lag expectations.
The report follows a year of surging capital spending by cloud giants. Companies building hyperscale facilities have warned of transformer shortages and interconnection delays. Those problems show no sign of easing before 2027, according to Bernstein.
NVIDIA, whose graphics processors are central to most AI data center builds, stands to benefit from the capacity crunch as operators prioritize high-margin compute over storage. The stock has climbed 146% this year on AI spending commitments from Microsoft, Amazon and Google.
Bernstein's note did not specify which projects face delays or cancellations. The analysts said the industry's reliance on a stretched supply chain means the situation will take years to resolve.
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