AI-driven compute demands have created four major supply chain choke points for data center buildouts: limited advanced-node foundry and packaging capacity, tight HBM supplies, power supply issues, and lasers for optical interconnects. Hyperscalers face mounting political and public opposition to new data center construction due to anticipated effects on regional power grids and water supplies. Legacy power management solutions cannot meet current demand, leading to growing interest in nuclear power and microreactors for data centers.
Multiple critical AI infrastructure inputs are simultaneously tightening, while public opposition and regulatory hurdles increase the cost and complexity of new data center buildouts.