Nvidia, Broadcom shielded as AI power crunch hits chip supply chain, says Morgan Stanley

Oct 5 : Nvidia and Broadcom are relatively insulated from a worsening US data-center power crunch, but any resultant delay in AI deployments can affect makers of memory, optical and other secondary chip components, Morgan Stanley said on Monday.

• The brokerage estimated last month that US data-center developers face a 34 per cent net power shortfall through 2028, equivalent to 32 GW, after accounting for measures such as behind-the-meter generation and fuel cells

• The AI boom has triggered billions of dollars in data-center investment, but the vast computing and electricity needs of generative AI are increasingly running up against US power supply issues

• Morgan Stanley and Goldman Sachs have both flagged mounting constraints on the US data-center buildout; GS expects limited near-term impact from political pushback, while MS sees labor, power and political challenges

• Morgan Stanley said it does not see the bottlenecks putting Nvidia or Broadcom's 2027 forecasts at risk, citing their visibility into chip placement, geographic expansion and coordination between data centers, semiconductor suppliers and the power supply chain

• If chip capacity cannot be deployed, customers could push out deliveries or cancel orders, with memory, optics, power-management and analog components most exposed to inventory disruption, the brokerage said