The AI trade’s biggest near-term risk may not be earnings but politics. Alger’s Ankur Crawford warns data center backlash could become a defining midterm issue.
Crawford, executive vice president and portfolio manager at Alger, made the comments on CNBC’s “Closing Bell.”
Data centers become a midterm flashpoint
Crawford said the fight over data centers could become what she called a “kill the AI” moment. She spoke hours before Nvidia (NVDA) posted Q2 results that sparked a 4% stock reversal.
Data centers, the massive facilities powering AI compute, have become an unusual bipartisan target. Ads in Texas, Ohio, Michigan, and Pennsylvania now blame both parties for rising electricity bills tied to their construction.
Crawford argued much of the criticism lacks evidence. She called water and noise complaints “FUD,” industry shorthand for fear, uncertainty, and doubt. Electricity strain is real, she said, but mainly emerges later this decade.
That distinction matters little to voters. Polling cited by Brookings found concerns over electricity rates, water use, and jobs cutting across party lines. Newsweek reported all six Senate toss-up races, per the Cook Political Report, touch the data center debate.
Texas Gov. Greg Abbott illustrates the shift. He once championed a $40 billion Google investment as proof of the state’s AI leadership. This summer, he introduced new water and electricity standards and ordered utility audits of data center permits.
Nvidia’s growth math still hinges on 2029
Crawford tied this political overhang directly to markets. She said Nvidia’s own numbers matter less than the multi-year question of margin structure and compute demand through 2029. Political resistance to new data center capacity threatens the growth assumptions behind that thesis.
She remains bullish. Crawford noted whisper numbers on 2028 earnings put Nvidia’s multiple in the low double digits. She called the stock a “coiled spring” relative to its growth rate.
The bigger unknown, she said, is whether skepticism fades as compute demand becomes tangible to ordinary voters. She pointed to AI-assisted personalized cancer treatment breakthroughs as the kind of visible benefit that could shift public opinion.
Whether that shift happens before or after November remains the open question hanging over the entire AI trade.
Bitrue