Inside the AI Data Center Boom: Where Power, Chips, and Cooling Converge

The physical backbone of artificial intelligence isn't in the cloud—it's in sprawling facilities like CoreSite's NY3 complex in Secaucus, New Jersey. CEO Juan Font likens these centers to shopping malls: multiple tenants sharing power, cooling, and space, but in a digital context. As Big Tech races to build AI capacity, these sites are multiplying nationwide.

It starts with power. Three years ago, clients asked for 10 to 30 megawatts—enough for a small town. Now, demand has jumped to hundreds of megawatts, and even gigawatts for the largest projects, says Michael Wall of Prime Data Centers. The grid can't keep up, pushing operators toward natural gas, fuel cells, and renewables. CoreSite uses fuel cells; GE Vernova supplies gas turbines, with shares up over 60% this year.

Inside the server rooms, Nvidia and Broadcom chips dominate. Nvidia remains the gold standard, while Broadcom's custom chips—like those co-designed with Google and Meta—are gaining ground. Optical fiber from Corning runs through these facilities, enabling fast, cool data transfer. Corning's optical communications segment grew 36% last quarter, driven by AI demand.

Networking equipment from Broadcom and Nvidia directs traffic, while cooling has become a critical challenge. Liquid cooling systems, supplied by Eaton and Dover, replace traditional air conditioning to handle the heat from dense server racks. Eaton recently acquired liquid cooling leader Boyd Thermal for $9.5 billion.

The AI infrastructure boom is reshaping industries. From power generation to chip design to cooling, the companies enabling these data centers are seeing unprecedented growth. For investors, the opportunity spans both household names and behind-the-scenes suppliers—all riding the wave of the fourth industrial revolution.

Source: CNBC