Published May 1, 2026
This week’s earnings announcements have reminded investors that the AI trade and the extraordinary amount of spending involved in building data centers has very beneficial effects on many companies’ bottom lines. Heavy equipment maker Caterpillar saw its stock blast higher on earnings. Utilities are moving upward despite valuations that would seem outrageous in times past. It’s boomtime in the heavy construction sector. Below are some snippets from Blaine Rollins’ recent roundup of comments from CEOs and related articles from investment and bank analysts.
“AI is driving all demand higher. The world is constrained from data center capacity to power capacity to CPU availability to even the of electricians…
“I think the main thing to know is. We have more demand than supply. For the first time in my 32 years at this company, we cannot give everybody everything they want to buy. So we need to build out this expansion… if you have sales, you can’t make because you don’t have capacity, and as soon as the capacity comes online, you actually start making more money. It’s about as simple as that.” – Microsoft President Brad Smith “
I think for the next 10 years, there will always be more demand than supply…there’s always a shortage, there’s never enough.” – Alphabet Google Cloud CEO Thomas Kurian “
These swarms of agents actually just took humans out of the loop. We have a whole other scaling law, where before, the chatbot only needed to be as fast as you could read, and you could type. Now I’ve got a chatbot that actually can read and write as fast as another chatbot can read and write another chatbot, and you can see where this is going. It’s causing an explosion of a need for more compute and also another path to optimize.” – NVIDIA VP of Hyperscale and High-Performance Computing Ian Buck “
Orders remain strong at roughly 2.5x revenue and increased 86% year-over-year to approximately $7.1 billion due to growing grid equipment demand, partially to support data center development.” – GE Vernova CFO Kenneth Parks “
Q1 revenue would have been meaningfully higher, but demand continues to outpace our growing supply. Our collective AI-driven businesses now represent 60% of revenue and grew 40% year-over-year..Even as we improve factory output, demand continues to run ahead of supply for all our businesses, especially for Xeon server CPUs, where we expect sustained momentum this year and next.” – Intel CEO Lip-Bu Tan “
We’re gonna need another half million electricians in this country, and it may be in two years, it may be in five or seven, but the reality is you can’t have more electricity without more electricians. And it means working with organized labor with community colleges across the country to give people the skills so they can fill these jobs.” – Microsoft President Brad Smith.
Data center sites have exploded, with 11,200+ globally today, while capacity is set to double to 200GW by 2030E. Meanwhile, AI-specific capacity has tripled in just 18 months. This is a transition era resource shock, attracting $7tn of investment by 2030E, consuming more electricity than Japan annually, drinking New York’ entire annual water use, and accounting for up to 6% of global critical metal demand.
By 2030, data centers could exceed 3% of global electricity demand, straining grids with large, inflexible loads as GPU power use grows c.30% annually. Hyperscalers have responded by moving upstream, driving 80% of top 10 corporate clean energy procurement, accelerating battery storage and locking in nearly half of SMRs capacity.
Market Update
Stocks closed Monday mostly unchanged as investors mostly looked past the stalemate in the Strait of Hormuz and focused on the earnings season. This week will see results from several of the tech heavy hitters. Will their earnings support the sharp April rebound in stock prices? Investors Tuesday seemed to think that they would with the Nasdaq adding +0.9% ahead of those earnings announcements. The Federal Reserve began their last meeting with Fed Chair Powell at the helm. It was expected that rates would not be changed. Wednesday found the Fed indeed keeping rates on hold while tensions with Iran pushed oil prices upward once again. After the close, earnings from Meta, Microsoft, Amazon, and Alphabet all blew away projections. But another step jump in AI-related spending gave investors pause sending all but Alphabet shares lower. But it was powerful earnings from Caterpillar, Eli Lilly and Qualcomm that stoked a sharp rally Thursday. The rise in Caterpillar lit a fire under infrastructure and utilities stocks. The indexes added +1% for the day to close out a spectacular month of April. May kicked off Friday with a solid earnings beat from Apple keeping investors positive. Apple helped the Nasdaq to another +0.9% lift Friday while the broader market closed mixed.
Stocks posted another positive week to close April with the best month in years. The S&P 500 (SPY) added +0.94% for the week. The Nasdaq 100 (QQQ) cruised to a +1.55% gain. Small cap stocks (IWM) ticked upward by +0.95%.
Warm wishes and until next week.