Trump tariffs could stymie Big Tech's U.S. data center spending spree

U.S. President Trump’s tariffs could slow down Big Tech’s efforts to build AI infrastructure in the country.

U.S. President Donald Trump's sweeping reciprocal tariffs could hamstring Big Tech's billion-dollar efforts to build artificial intelligence infrastructure in the country, likely undermining a key goal of the administration, analysts said on Thursday.

Trump and technology executives have touted lofty plans by Oracle, SoftBank and others to invest heavily in artificial intelligence since his return to the White House earlier this year.

On Wednesday, Trump slapped steep duties on leading technology equipment suppliers including 34% on China, 32% on Taiwan and 25% on South Korea, while imposing a 10% baseline tariff on all imports to the U.S.

Electronics - which include smartphones, PCs and data-center equipment - were the second biggest imports last year at nearly $486 billion worth of goods, according to Census Bureau data.

Bernstein analysts pegged data processing machine imports at about $200 billion in 2024, mostly from Mexico, Taiwan, China, and Vietnam.

"Capital expenditure by tech giants will get reshuffled: Expect major players in AI infrastructure and consumer tech to reallocate short-term spending away from expansion and toward procurement hedging or sourcing shifts," said Abhishek Singh, partner at research firm Everest Group.

While semiconductors were exempted from Wednesday's tariffs, the U.S. is planning targeted tariffs for chips that could come later, a White House official said.