Blackstone stated Thursday its large investments in knowledge facilities wouldn’t be undermined by the low-cost synthetic intelligence fashions from China’s DeepSeek, as the necessity for bodily infrastructure was nonetheless very important for AI.
The choice asset supervisor, which has $80 billion value of leased knowledge facilities, stated its technique for the section was grounded in a “very prudent method” and touted its partnerships with “a few of the largest corporations on the planet.”
Information facilities present the infrastructure for storing, processing and analyzing huge troves of knowledge which are essential for coaching and operating AI fashions.
Traders in knowledge facilities, similar to Blackstone, had been anticipated to be a few of the largest beneficiaries of the AI increase as growing adoption led to increased demand for such infrastructure.
However the sudden arrival of DeepSeek upended the tech world and sparked a debate over demand, with worries that the emergence of a low-cost choice could gradual funding in knowledge facilities.
Blackstone’s president and Chief Working Officer Jonathan Grey, in a post-earnings name with analysts, stated the corporate was carefully watching developments tied to DeepSeek.
Nevertheless, he expects decrease prices may but result in a wider adoption of AI, boosting demand for knowledge facilities.
“As utilization goes up considerably, there’s nonetheless a significant want for knowledge facilities. We nonetheless assume it’s a vital section,” Grey stated.
His feedback echo views from analysts at Jefferies earlier this week.
“In actual fact, we’d be shocked to see hyperscalers gradual their capex plans because the AI house simply obtained much more aggressive,” they wrote.
DeepSeek’s launch has triggered scrutiny from traders, who’re anticipated to investigate tech giants’ AI spending plans carefully within the subsequent few weeks.
CEOs of Microsoft and Meta additionally defended large AI spending this week saying it was essential to staying aggressive within the new subject.
Blackstone shares had been final down almost 4% in afternoon buying and selling.