Bloomberg Intelligence Microsoft Forecasts Show Data Center Crunch Persisting Into 2026
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Oct 10, 2025 Microsoft faces a persistent data center crunch, with shortages impacting cloud growth and AI infrastructure. Analysts discuss how this affects spending and margins in tech. Meanwhile, Stellantis feels pressure from proposed tariffs due to its reliance on Mexican production, prompting potential reshoring. In retail, strong demand is seen in hardlines like beauty and sports goods, despite economic uncertainties. Loyalty programs and unique products are key for retailers to keep customers engaged in a competitive market.
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AI Build-Out Is A Multi-Year Process
- The AI data-center build-out is still in early innings and will span years because facilities take long to permit and construct.
- Anurag expects this conversation to persist for at least five to seven years, affecting long-term demand.
Crunch Affects All Hyperscalers Equally
- The capacity crunch is industry-wide; Google, Meta and Amazon face similar pressures and will tap remaining third-party capacity.
- Whoever has spare capacity will attract large customers from the hyperscalers.
Earnings: A Tale Of Two Tech Segments
- In upcoming earnings, watch for diverging results: discretionary software will slow while AI-related bookings and backlogs rise.
- Focus on infrastructure names that will report increased order books and capacity demand.