Blackstone remains bullish on data centres despite AI cost concerns

Blackstone has reaffirmed its confidence in its $80 billion data centre investments, stating that the rise of low-cost AI models from China‘s DeepSeek will not diminish the need for physical infrastructure. The asset manager stressed that data centres remain essential for training and running AI models, highlighting its partnerships with leading global companies as a sign of continued demand.

The emergence of DeepSeek has raised questions about whether more efficient AI models could reduce the need for large-scale data centres. However, Blackstone’s President and Chief Operating Officer Jonathan Gray believes lower costs could instead drive wider AI adoption, ultimately increasing demand for infrastructure. Analysts at Jefferies echoed this view, suggesting that hyperscalers are unlikely to slow their capital expenditure plans despite the industry’s rapid evolution.

AI investments by major tech firms remain strong, with Microsoft and Meta recently defending their heavy spending on AI to maintain a competitive edge. Blackstone’s shares were down nearly 4% in afternoon trading as investors closely monitored developments in AI infrastructure demand.