Barclays warns data center equipment makers face pricing squeeze

The companies selling picks and shovels to the AI gold rush may be about to learn what happens when the miners start haggling. Barclays analysts say the growth cycle for data center equipment vendors is peaking. They also warn that these suppliers face a rising risk of a pricing squeeze from the AI labs buying their gear. What Barclays is flagging The bank’s report, dated October 20, 2026, focuses on vendors of power and electrical equipment for data centers. Think transformers and switchgear: the unglamorous hardware that moves electricity from the grid to rows of AI servers. These suppliers have ridden a strong wave of demand as hyperscalers built out capacity for AI workloads. Barclays singled out three major electrical infrastructure names: Siemens Energy AG, ABB Ltd. and Schneider Electric SE. All three have enjoyed strong returns from the current cycle, according to the report. The concern is what comes next. As AI labs look for ways to lower costs, the analysts see mounting pressure on what suppliers can charge. Barclays also points to buyer consolidation as the market matures. When a handful of very large customers account for much of the demand, those customers tend to gai...