Morgan Stanley forecasts that global capital expenditures for data centers will reach $2.9 trillion between 2025 and 2028. This spending is driven by the infrastructure requirements of artificial intelligence.
The bank estimates that major technology companies, including Amazon, Microsoft, Alphabet, Meta, and Oracle, will self-fund $1.4 trillion of this total. This leaves an external financing gap of $1.5 trillion.
Of the total expenditure, $1.6 trillion is allocated for IT hardware such as chips and servers, while $1.3 trillion is designated for physical infrastructure and construction projects.
Private credit markets are expected to cover approximately $800 billion of the funding shortfall through asset-specific loan structures. Additionally, hyperscaler lease commitments exceed $1.2 trillion.
Nvidia is reportedly in discussions regarding backstop guarantees of up to $250 billion to support data center debt financing. Meanwhile, the US faces a projected power shortfall of 32 to 33 GW by 2028.
