Investor Kevin O'Leary Says Roughly 65% of North American Data Center Projects May Never Be Built; Permitted, Powered Sites Could Gain Value Through Scarcity

AI infrastructure stocks recently faced what appeared to be a straightforward bear case: companies like CoreWeave, Applied Digital, and IREN are pouring enormous capital expenditure into new data center campuses, much of it financed through borrowing, and investors want to know whether that capacity will ever pay for itself. CoreWeave fell about 25% in a matter of days during the recent sell-off, while Applied Digital and IREN slid roughly 50% from their summer highs, seemingly confirming the concern.

But Canadian investor Kevin O'Leary, known as Mr. Wonderful from the television show Shark Tank, argues the market is tracking the wrong variable. He estimates that roughly 65% of data center projects announced across North America in the past two years may never be built—not because demand is insufficient, but because of missing water, fiber, or power, or because of a political moratorium. He expects 60% to 65% could be shut down within 24 months. If this assessment holds, the real scarcity is not compute capacity but sites that have already cleared power and permitting hurdles.

O'Leary splits the opportunity into two verticals: power and compute/storage capacity. On power, he believes the broader economy needs far more grid capacity regardless of AI. On compute, he estimates current demand sits at roughly three times available capacity, with no slowdown in sight for three years. He notes that much of what Amazon, Alphabet, and Microsoft run through their data centers has nothing to do with AI.