<div id="readability-page-1"><div>Global data centers dealmaking surged to hit another record high this year, driven by a rush to build out the infrastructure required for energy-intensive AI workloads.That surge came even as investors grew increasingly wary of inflated artificial intelligence valuations and the financing underpinning the rapid expansion of data centers. Global stocks sold off in November as worries of an AI-fueled bubble persisted.But S&amp;P Global reported that more than $61 billion has flowed into the data center market this year, up slightly from $60.8 billion last year, amid what it called a &#34;global construction frenzy.&#34;</div><div>A surge in debt financing contributed to the record high as hyperscalers increasingly tap private equity markets rather than funding the expensive infrastructure themselves. That trend has sparked concerns from some investors as they question the value of the advanced tech that data centers house.Shares of cloud company Oracle fell 5% on Wednesday following a report that Blue Owl Capital was pulling out of a deal to back a $10 billion data center in Michigan. Oracle has denied the report, but Broadcom, Nvidia and Advanced Micro Devices retreated after it was published. The Nasdaq Composite lost 1.81% in its worst day in nearly a month.Iuri Struta, TMT analyst at S&amp;P Global Market Intelligence, said his team expects market concerns around AI and Oracle to be temporary and unlikely to have a &#34;massive impact&#34; on data center buildout and M&amp;A in the near future.&#34;The competitive dynamic among frontier AI model providers, like OpenAI, Alphabet and Anthropic, is changing quickly, and this can have an impact on investor sentiment in public markets. But overall, we see demand for AI applications continuing to grow strongly in 2026.&#34;Despite the recent pullback in AI stocks, many analysts remain bullish on the sector. Bank of America said &#34;the AI trade may still have room to run into 2026,&#34; while warning that shares going up does not mean a bubble isn't forming.&#34;AI is unstoppable at the moment, but it's not without any kind of risk,&#34; said Wim Steenbakkers, managing director of ING's global lead satellite and technology, at a recent press event. He added that with cloud businesses expected to grow at a rate of 20 to 40% per year, data center capacity will need to double every three to four years.There were more than 100 data center transactions in the first 11 months of the year, whose total value already exceeds all the deals done in 2024, according to S&amp;P Global Market Intelligence data. The majority of those deals took place in the U.S., followed by the Asia-Pacific region.</div><div>&#34;In Europe, the buildout of data centers is expected to grow at a lower rate than other regions, but it remains to be seen if this results in an M&amp;A rush amid scarcity of assets,&#34; Struta said.The pace of growth in the U.S. is leaving Europe &#34;in the dust&#34; according to a recent report from ING which predicted data center investment in the U.S. could be fivefold higher. Growth is also increasingly coming from the Middle East, as the wealthy Gulf States look to position themselves as the next global AI hub.</div><div>Debt issuance nearly doubled to $182 billion in 2025, up from $92 billion last year, according to the data from S&amp;P. It noted that Meta and Google were among the most active issuers, with Facebook's owner raising $62 billion in debt since 2022 — nearly half of that total was issued in 2025 alone.Google and Amazon raised $29 billion and $15 billion, respectively, according to the report, which noted that hyperscalers are increasingly working with AI labs to buy assets to finance construction in an &#34;unusual arrangement&#34; that underscores the significant capital required to meet demand.</div><div>Struta expects more &#34;robust&#34; M&amp;A investment activity in the data center space in 2026.&#34;I wouldn't be surprised if already high valuations get even higher,&#34; he told CNBC. &#34;The buildout of new data centers can be temporarily tempered by a lack of energy supply, making already built data centers more valuable. As the availability of large data center companies remains scarce, we could see more asset sales by companies that don't view data centers as their core business.&#34;</div></div>

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Data center deals reached a record $61 billion in 2025, driven by AI infrastructure needs despite investor concerns over AI valuations and debt financing. Hyperscalers are increasingly using private equity for funding. Oracle shares fell after a report of a deal withdrawal, but analysts expect AI demand to grow. Debt issuance doubled, with Meta and Google leading. The U.S. outpaces Europe in data center growth, with the Middle East emerging as a new hub. M&A activity is expected to rise in 2026.

- Global data center dealmaking reached a record high of over $61 billion this year, driven by demand for infrastructure to support AI workloads.  
- Despite concerns over AI valuations and a recent pullback in tech stock prices, analysts predict continued demand for data centers, especially in the U.S. and the Middle East.  
- Debt financing has surged, contributing to the record investments, and future M&A activity is expected to intensify as companies vie for essential data center capacity.

Data center deals hit record $61 billion in 2025 as AI valuation risks and funding concerns grip investors