Morgan Stanley increased its total hyperscaler CapEx forecast to $1.4 trillion by 2028, up from ~$1.2 trillion in 2027, projecting a fourfold expansion of compute capacity to 120 GW by 2028 from ~30 GW in 2025. Data center deployment costs per gigawatt are rising, with construction timelines stretching up to three years due to bottlenecks in chips, racks, and powered shells.
Hyperscalers are committing unprecedented capital to AI infrastructure, but rising costs and multi-year construction delays will constrain compute supply growth.