News 24 · Updated 07/30, 01:05 PM
Long Read 2026-07-27

The AI Capex Supercycle: Where the Money Is Actually Going

Hyperscaler capex guidance keeps beating estimates, but the mix has shifted hard toward power, land and interconnect. A look at which parts of the chain are absorbing the incremental dollar.

The mix is shifting, not just the total

Two years ago, an incremental hyperscaler capex dollar went overwhelmingly to accelerators. Today a meaningfully larger share is going to power infrastructure, land, cooling and networking — the parts of the stack that don't scale as elastically as chip supply does. That's why 'capex beat' headlines increasingly need a second look at where the dollars landed.

Power is the new bottleneck, and it shows up in lead times

Gas-turbine order backlogs at major manufacturers now stretch past three years in some cases — longer than it takes to build the data centre shell itself. That single fact is doing more to explain deployment timelines than any GPU allocation story, and it's why nuclear, SMR and grid-equipment names have become part of the AI conversation rather than an adjacent one.

Where that leaves the equity picture

The clearest, least-debated read-through is in electrical equipment and liquid cooling, where backlog-to-book ratios are climbing and lead times keep extending across the group. The more contested layer is the neocloud/GPU-rental segment, where headline demand is strong but utilisation and contract-duration questions make the unit economics harder to underwrite from public disclosures alone.

Read-through
Primary read-through: data-centre power and electrical equipment, liquid cooling, and AI servers. Secondary: colocation/GPU rental, where the capex-to-utilisation debate is least resolved.
Electrical EquipmentLiquid Cooling & ThermalGas Turbines & GensetsNuclear & SMRColocation & GPU RentalAI Servers & ODM
Fund Exposure
First Trust Grid & Power ETF GRID11.4%
Global X U.S. Infrastructure Development ETF PAVE4.6%
Timeline
Aug 12
CoreWeave 2026 Q2
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