Cloud computing giants can’t afford to spend every penny on increasing artificial intelligence, CNBC’s Jim Cramer argued Wednesday.
Cramer’s comments came after hearing someone describe the rise in data center and AI stocks as a “build it and they will come” dynamic, the idea that companies are spending aggressively on infrastructure in hopes that customers will eventually realize it. But Kramer said applying the famous line from the movie “Field of Dreams” to the AI boom misses the point: The customers are already there, and cloud providers are racing to keep up with demand.
“The whole point of this data center rally is that this is not a fairy tale, because data centers are being built and customers are actually coming,” the “Mad Money” host said. “They’re in the arena. They’re in the seats… and momentum is building to fill every seat.”
he pointed to Amazon Proof that building AI is no longer speculative is the company’s cloud business, Amazon Web Services. Amazon has pledged to spend about $200 billion in capital spending this year, much of it to expand data center capacity as competition intensifies among major cloud providers.
“If we don’t build a stadium, they’re going to go elsewhere and they’re going to have a lot of money sitting around,” Kramer said, citing comments from Amazon CEO Andy Jassy about the need to continue investing aggressively.
According to Cramer, OpenAI, Anthropic, Meta is already looking for partners with computing power and infrastructure that can handle large-scale AI workloads.
“They, the potential customers who are willing to pay a lot of money, are already here. Unless we put money into building the infrastructure, they’re going to go elsewhere,” he says.
Kramer noted that many skeptics continue to underestimate both the scale and urgency of the current AI spending cycle. He said companies that are slow to invest risk losing business to rivals that continue to expand their production capacity.
“If Amazon doesn’t put in the money, its business and its billions of dollars in payments should go down, not up. alphabet or microsoft“When it comes to data centers, if you build it, they really will come. And if you don’t build it, they just end up in the hands of other people who build it.”
