Democratic victories in the US midterm elections have triggered a market sell-off for semiconductor and AI infrastructure companies as voters favor restrictions on artificial intelligence expansion. Following Democratic control of Congress and governorships in Texas, Georgia, and Ohio, investors reacted to potential regulatory hurdles regarding data centre construction.
Nvidia saw shares plunge 9% following the election results, causing founder and CEO Jensen Huang to fall from ninth to 13th place on the Bloomberg Billionaires Index. Other major semiconductor firms also faced losses, including Taiwan Semiconductor Manufacturing Company (TSMC), which dropped 10%, German firm Infineon, which fell 8%, and ASML.
In response to political pressure, OpenAI launched a charm offensive by publishing a policy blueprint and a compact for future sites. The company, which began referring to its facilities as "computer campuses" in September, pledged to disclose noise studies and water usage data and to cover the costs of electricity and grid updates in affected areas. The company stated its goal is to ensure development gives communities a meaningful voice and shares economic gains.
Meta saw its stock price shed 4% on Thursday, 5 November, despite a $1 billion pledge to build a data centre in Ohio. Meta president Dina Powell McCormick told the Wall Street Journal Tech Conference that the midterm results will make it harder for companies to build data centres. "The visible sort of manifestation of AI is a data centre, and it’s something that people can say, ‘I don’t want this in my community'," Powell McCormick said.
Senator Bernie Sanders called for a "national data center moratorium now," arguing that the expansion of Big Tech threatens the environment and jobs. Elon Musk, who spent $474 million backing Republican candidates, saw shares in SpaceX fall almost 4% and Tesla drop 2% this week. Following the election results, Musk wrote on X that "data centres in space looking pretty appealing right now".
While OpenAI's new commitments apply to sites the company owns and operates, the impact on infrastructure held by partners like Oracle remains unclear.
