SoftBank's $50 Billion Data Center IPO Stalls as Wall Street Backs Away
Wall Street Is Growing Skeptical of the Data Center Boom
Wall Street is turning skeptical of the data center boom. SB Energy, a SoftBank subsidiary planning the world's largest data center project in Ohio, has delayed its IPO after bankers struggled to find buyers at a valuation of $50 billion or more. Holtec, a nuclear supplier for AI power, paused its offering indefinitely, citing impaired investor confidence. Public backlash against energy-hungry facilities is now hitting the IPO market.
SB Energy's struggles to win over investors comes as Holtec, a company serving the nuclear energy industry that is looking to supply power for A.I., said last week that it was pausing its I.P.O. plans indefinitely, citing several factors that has "impaired investor confidence in the market for new public offerings."
- toomuchtodo
- bryanlarsen
Any data center that can remain profitable selling open source tokens at commodity prices will be fine. Any data center that relies on OpenAI/Anthropic level token prices and margins might be in trouble. After clearing their debts through bankruptcy, they'd likely be quite profitable selling open source tokens at commodity prices.
- Apes
I'll believe it the day SpaceX - the AI company that is mostly making money selling datacenter compute using gas turbines for energy - takes a single day 90% or greater drop in stock price.
- vannevar
The AI Bubble should more accurately be called the Data Center Bubble. Private credit sold everyone on the idea that AI needs massive data centers right away, because they needed a new narrative to lure investors into funds that are sitting on rapidly deteriorating assets from years of bad loans. As it becomes more and more obvious that these massive data centers are neither wanted nor needed, the Data Center Bubble will burst. AI is going to be just fine, but private credit and the hyperscalers, pension funds, and insurance trusts that they suckered in will be left holding the bag.
- fedecaccia
There are two different clocks here. Financials could change in months, but the electrical infrastructure needs to be planned with years.
Gas turbines are all practically sold out till 2030, delivery time changed from 2-3 years to 5-7yrs.
Many announced data centers where destined to delay, independently from financial markets, due to the available infrastructure.
If the AI/data centers fomo dissapear, the effect on electrical production will take years in take effect, because capacity is already reserved and paid.
In oposition to software, energy infrastructure is not flexible: you can't speed up a turbine projected for 2032 neither cancel the order without a considerable cost.