Add as a preferred source on GoogleJim Cramer Says Amazon May Gain if Data Center Projects Slow
Cramer said existing cloud networks and lower reliance on neocloud providers could help established operators capture demand if new capacity is harder to build.
Jim Cramer, host of “Mad Money,” said Monday that Amazon could gain an edge if data center construction slows, arguing its established cloud network may help it compete for demand as new capacity becomes harder to build.
Cramer compared the prospect to a yellow flag in Formula One, when all drivers must slow down. “If that’s the case, that’s Microsoft and that’s Amazon winning,” he said.
Amazon and Microsoft already operate extensive data center networks. Cramer said those existing systems give large cloud providers an advantage over smaller neocloud providers, which rely more on continued expansion to grow. He also argued that established operators may be better equipped to navigate bureaucratic obstacles.
Cramer said demand for AI computing could continue even if new data centers become harder to build. Amazon has relied less on neocloud providers to secure extra computing capacity, he said.
A slower buildout could ease pressure on hyperscalers to keep increasing capital spending. That may give free cash flow room to recover and improve returns on infrastructure already in place, Cramer argued.
Growing opposition to new data center projects after last week’s midterm elections has raised concerns about future infrastructure spending. Cramer’s comments build on his Nov. 5 warning about opposition to data centers and AI-linked stocks.