Data Centers Are Winning Customers While Losing Voters
The AI and data center trade could be impacted by growing political discourse.
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Bernie Sanders, Alexandria Ocasio-Cortez and Steve Bannon have finally found common ground: the call to stop building data centers.
It’s a great campaign line, but terrible policy.
Sanders and Ocasio-Cortez want a moratorium on new construction, and Bannon is cheering them on. To be fair, they’re tapping into real anxiety around power bills, water, noise and whether local residents will benefit when a giant facility moves into town.
Social media has taken those concerns and poured gasoline on them.
But turning the lights out on AI and the power it needs isn’t the answer.
Banning data centers won’t make demand for computing power disappear. It’ll shift construction, investment and jobs elsewhere — likely outside of the U.S. Meanwhile, the data center developers building these facilities just reported a quarter that looked nothing like an industry in retreat.
Applied Digital (APLD) brought another 75 megawatts online at Polaris Forge 1, taking the campus to 175 megawatts. Cipher (CIFR) started delivering space at Black Pearl two months early. Galaxy (GLXY) finished the first 133-megawatt phase of Helios on schedule. And Core Scientific (CORZ) was billing for 437 megawatts by mid-July.
The contracts aren’t slowing down either.
Riot (RIOT) delivered 25 megawatts to AMD (AMD) and signed a 20-year lease for another 191 megawatts. CleanSpark (CLSK) signed a 20-year, $6.6 billion lease in Georgia. And TeraWulf (WULF) signed a 20-year deal with Anthropic covering roughly 401 megawatts.
More importantly, some of these sites are now producing revenue, while larger customers are signing longer leases directly with developers.
I’ve seen enough over my 25-plus years in the market to know that trees don’t grow to the sky. Every part of the AI trade has been — and will continue to be — volatile. Frankly, it’s a trader’s paradise. But companies don’t sign 20-year leases worth billions of dollars unless they expect to need the space.
That doesn’t mean the stocks are acting well. Since June 15, APLD, WULF, CORZ and IREN have fallen between 32% and 44%, and most of the group remains below the moving averages I follow. With a few exceptions, like NVIDIA (NVDA), I don’t see the kinds of setups I want to chase here. But beyond a very short-term trade, I don’t want to bet against this theme, either.
This past quarter’s reports leave me more bullish than ever on the AI/data center trade, but that doesn’t change the fact that the industry is losing the public argument. A Gallup poll found 71% of Americans oppose data centers near their communities, and attacks on AI or data centers have appeared in more than 70 federal races. Treasury Secretary Scott Bessent said builders have done a “horrendous job of explaining themselves to the American people.”
And he’s right.
Developers and technology investors are responding with advocacy groups and a new political action committee. Fine. Politics requires money. But a PAC cannot explain a utility agreement at a town meeting, answer a homeowner’s concerns about water, or prove that promised jobs will actually materialize.
That’s local work. It happens at town halls in high school gymnasiums, not at Washington fundraisers.
Developers need to publish clear power and water plans, show who pays for grid upgrades, explain how many permanent jobs a project will create, and put their promises in writing. They need electricians, teachers, small-business owners, and local officials telling the story, not billionaires talking past voters.
The latest earnings showed an industry that can build sites, deliver power and land customers.
Now it needs to learn how to tell its story.
At the time of publication, Byrne had no positions in any securities mentioned.
