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16 Jan 2025

Powering AI: Are You Investing in AI Data Center Growth?

VistaShares Investment Committee

Powering AI: Are You Investing in AI Data Center Growth?

Does your fund truly give you exposure to the key companies benefiting from the unprecedented AI infrastructure investments? You may want to look under the hood of your fund, you might be missing out on the companies driving this transformative growth.

As artificial intelligence reshapes industries, data centers are at the heart of this transformation. These extensive facilities serve as the foundational infrastructure supporting AI’s exponential demands for data processing, computational capacity, and network connectivity. Companies across the globe are doubling down on their investments to build AI-enabled data centers, creating opportunities for investors to tap into this massive infrastructure boom.

Recent Announcements in AI Data Center Investments for 2025

2025 has already seen groundbreaking commitments from leading firms:

  • Reuters: Microsoft plans to invest $80 billion on AI-enabled data centers in fiscal 2025
  • Reuters: AWS plans to invest at least $11 billion in Georgia to enhance its cloud and AI infrastructure. This investment is expected to create hundreds of jobs and bolster Georgia’s status as a digital innovation hub.
  • Google pledged $3 billion for enhancing its cloud and AI data capabilities in Europe.
  • Meta revealed a $1 billion initiative to expand its AI-driven data center footprint, focusing on high-performance computing (HPC) systems.

These developments highlight how pivotal data centers are in the race for AI supremacy, making it essential for investors to ensure their portfolios capture these opportunities.

What Is an AI Data Center?

AI data centers are specialized facilities designed to support the complex computational needs of artificial intelligence workloads. Unlike traditional data centers, AI data centers feature cutting-edge components such as GPUs (graphics processing units), DPUs (data processing units), and advanced cooling systems to handle the immense heat generated by these high-powered processors. They serve as the backbone of modern AI applications, enabling everything from language models to real-time decision-making in autonomous vehicles.

A Closer Look at the Bill of Materials (BOM)

The cost of building an AI data center runs into millions, with the total estimated BOM cost for a fully equipped data center around $10 million. Here’s how those costs break down:

  • Power and Cooling Systems (30%): Critical for maintaining optimal operating conditions, these systems represent the largest portion of the BOM.
  • Servers and IT Equipment (28%): These are the core of any data center, responsible for data processing and storage.
  • Network Equipment (15%): Essential for connecting the data center to the broader network.
  • Storage Devices (10%): Hardware for storing, accessing, and retrieving data.
  • Backup and Disaster Recovery Solutions (7%): To protect data and minimize downtime.
  • Software (5%): Enables data traffic management, resource allocation, and capacity planning.
  • Racks and Cable Management (4%): Keeps the infrastructure organized and functional.
  • Remote Hands Support (1%): For on-site technical support and maintenance.

These components highlight the diverse ecosystem of players involved in the AI data center value chain—from semiconductor giants like NVIDIA and AMD to infrastructure firms like Arista Networks and Vertiv.

The graphic below illustrates the cost contributions of various components in building an AI data center. As you can see, power and cooling systems, servers, and IT equipment dominate the BOM, reflecting their critical role in ensuring these centers operate efficiently.

Source: Bita Indexes

As artificial intelligence continues to fuel demand for specialized infrastructure, the investment opportunities within this ecosystem are expanding rapidly. To truly capitalize on the AI data center revolution, we believe it’s essential to have exposure to the company’s leading innovation and growth in this space.

The VistaShares Artificial Intelligence Supercycle ETF (ticker: AIS) offers a pure-play AI infrastructure investment solution, targeting the key beneficiaries of this unprecedented AI-driven growth.

Are you positioned to profit from the surge in AI infrastructure investment?

With AIS, you can ensure your portfolio captures this transformative opportunity.

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About VistaShares

VistaShares ETFs are actively managed to offer Pure Exposure™ to the economic Supercycles™ that we believe are poised for significant growth. Supercycles™ are long-term trends that disrupt current economic models through leading edge technological advancements shaping our world.

Important Information:

For the VistaShares Artificial Intelligence Supercycle ETF (AIS) top holdings & fund details, please visit: www.vistashares.com/etf/ais/#holding

Investors should consider the investment objectives, risks, charges and expenses carefully before investing. For a prospectus or summary prospectus with this and other information about the Fund, please call (844) 875-2288 or visit www.VistaShares.com. Read the prospectus or summary prospectus carefully before investing.

Investing involves risk, including possible loss of principal.

Important Information:

Artificial Intelligence Risk. Issuers engaged in artificial intelligence typically have high research and capital expenditures and, as a result, their profitability can vary widely, if they are profitable at all.
Equity Market Risk. Common stocks are generally exposed to greater risk than other types of securities, such as preferred stock and debt obligations, because common stockholders generally have inferior rights to receive payment from specific issuers.
Technology Sector Risks. The Fund will invest substantially in companies in the technology sector, and therefore the performance of the Fund could be negatively impacted by events affecting this sector.
Foreign Securities Risk. Investments in securities or other instruments of non-U.S. issuers involve certain risks not involved in domestic investments and may experience more rapid and extreme changes in value than investments in securities of U.S. companies.
Tracking Error Risk. While the Fund generally seeks to track the performance, before fees and expenses, of the Index, the performance of the Fund and its Index may differ from each other for a variety of reasons.
Concentration Risk. To the extent that the Fund concentrates in an industry, it will be subject to the risk that economic, political, or other conditions that have a negative effect on that industry will negatively impact the Fund to a greater extent than if its assets were invested in a wider variety of industries.
Industry Risks. The Fund is subject to the following risks:
Semiconductor Industry Risk. Competitive pressures may have a significant effect on the financial condition of semiconductor companies and, as product cycles shorten and manufacturing capacity increases, these companies may become increasingly subject to aggressive pricing, which hampers profitability.
Datacenter Industry Risk. The datacenter industry faces numerous challenges that could significantly impact the financial performance of companies operating within this sector.
Software Industry Risk. The software industry can be significantly affected by intense competition, aggressive pricing, technological innovations, and product obsolescence.
New Fund Risk. The Fund is a recently organized management investment company with no operating history. As a result, prospective investors do not have an extensive track record or history on which to base their investment decisions.

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