Morgan Stanley highlights strong supply chain visibility as power grid bottlenecks threaten secondary chip suppliers.
Leading chipmakers Nvidia and Broadcom remain well insulated from an intensifying power shortfall facing US data centres, according to a report from Morgan Stanley. However, potential delays in artificial intelligence infrastructure deployments could trigger inventory disruptions for memory, optical, and secondary component manufacturers.
The brokerage estimates that US data centre developers face a net power deficit of 34 per cent through 2028—equivalent to a 32 GW shortfall—despite mitigation efforts including on-site behind-the-meter generation and fuel cell installations. While skyrocketing AI demand has attracted billions of dollars in infrastructure investment, power grid capacity constraints are becoming a primary bottleneck.
Morgan Stanley noted that these grid limitations will not impact 2027 earnings forecasts for Nvidia or Broadcom, citing high visibility into global chip placements, international geographic expansion, and tight supply chain coordination. However, the report warned that if data centre construction stalls, hyperscale clients may defer secondary hardware orders, exposing power-management, analogue, and optical component vendors to sudden inventory imbalances.
Addressing infrastructure readiness during Nvidia’s August earnings call, Jensen Huang, President and Chief Executive Officer of Nvidia, stated: “We work with power generator companies. We downstream. We worked with land power and shell companies all around the world. And that helps prepare all of this computing that’s going to be built that will ultimately deploy for our ecosystem and our customers.” Huang emphasized that these collaborative activities provide Nvidia with significantly greater operational visibility across both upstream and downstream supply chains.
