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Blackstone To Invest $8.2 Billion In Data Centres 

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Blackstone, the largest alternative asset management company in the world, intends to invest 7.5 billion euros ($8.2 billion) in data centre development in Spain’s Aragon region.

TakeAway Points:

  • Blackstone plans to invest 7.5 billion euros ($8.2 billion) to develop data centres in Spain’s Aragon.
  • The company will develop the buildings by installing cooling machines and cable connections with the aim of leasing them to companies that will install computer servers.
  • Nvidia’s shares finished at all-time highs, placing the dominant AI chipmaker in a position to overtake Apple as the most valuable corporation in the world.

Blackstone invests in data center

The U.S. private equity fund will follow tech giants such as Microsoft and Amazon  in choosing the regional capital Zaragoza in northeastern Spain, where so far 19 data centres projects have been submitted to local authorities for approval, a spokesperson for Aragon’s regional government said on Tuesday.

Blackstone will develop the buildings by installing cooling machines and cable connections with the aim of leasing them to companies that will install computer servers.

The Aragon regional government said in June that tech giant Microsoft was planning a 6.69-billion-euro investment in data centres in the region and Amazon’s cloud computing unit AWS said in May it would invest 15.7 billion euros to build its own data centres there.

Amazon said it would power its data centres with renewable energy. The Aragon region has a large wind power capacity.

Nvidia Shares Surges 

Shares of Nvidia closed at their highest ever on Monday, putting the heavyweight AI chipmaker on the brink of dethroning Apple as the world’s most valuable company.

With investors betting on strong demand for its current and next-generation AI processors, the Santa Clara, California company’s stock climbed 2.4% to end the day at $138.07.

In June, Nvidia briefly became the world’s most valuable company. It was overtaken by Microsoft, and the tech trio’s market capitalizations have been neck-and-neck for several months.

The latest gains lifted Nvidia’s market value to $3.39 trillion, just below Apple’s $3.52 trillion value and above Microsoft’s $3.12 trillion.

Nvidia has been Wall Street’s biggest winner from a race between Alphabet, Microsoft, Amazon and other major tech companies to dominate emerging AI technology.

“We believe the major companies in AI … face an investment environment characterized by a Prisoner’s Dilemma — each is individually incentivized to continue spending, as the costs of not doing so are (potentially) devastating,” TD Cowen analysts wrote in a report on Sunday.

TD Cowen reiterated its $165 price target for Nvidia, which it called its “Top Pick”, and it said demand for the company’s current generation of AI chips remained strong.

Nvidia in August confirmed reports that a ramp-up in production of its upcoming Blackwell chips was delayed until the fourth quarter, but downplayed the impact, saying customers were snapping up existing chips.

As investors gear up for quarterly reporting season, Apple rose almost 2% and Microsoft added 0.7%, helping propel the S&P 500  up 0.8% to its own record high close.

Nvidia, Apple and Microsoft account for about a fifth of the S&P 500’s weight, giving them a hefty influence in the index’s day-to-day gains and losses.

Taiwan Semiconductor Manufacturing Co, the contract manufacturer that produces Nvidia’s processors, is expected to report a 40% leap in quarterly profit on Thursday, thanks to soaring demand.

Analysts expect spending to build out AI data centers will help Nvidia’s annual revenue more than double to nearly $126 billion, according to LSEG data.

While Nvidia’s rally has lifted the S&P 500 to record highs, investors worry optimism about AI could evaporate if signs emerge of a slowdown in spending on the technology.

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