Meta Signs Multi-Gigawatt Nuclear Deals for AI Data Centers

0:00Hello, I'm Stephen Carroll. I'm in Brussels where many of Europe's biggest decisions get made. And I'm Caroline Hepker in London with the hosts of the Bloomberg Daybreak Europe podcast. We're up early every weekday keeping an eye on what's happening across Europe and around the world. We do it early so the news is fresh, not recycled and so you know what actually matters as the day gets going. From Brussels, I'm following the politics, policy and the people shaping the European Union right now. And from London, I'm looking at what all that means for markets, money and the wider economy. We've got reporters across Europe and around the globe feeding in as stories break.

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1:02Bloomberg Audio Studios. Podcasts. Radio. News. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts or watch us live on YouTube. Let's go back to the tech sector. We can't stray too far from it ever when we talk about the market. And take a look at some of the MAG7 names. Alphabet this week has moved ahead of Apple in terms of market cap. And Meta signing this big, big power generation deal with this company called Vistra, which has had a really volatile week.

1:43Let's bring in Mandeep Singh right now. Mandeep is our global tech research head at Bloomberg Intelligence. And Mandeep, just put into context for us this multi-gigawatt nuclear deal that Meta has signed for its AI data centers. How should we think about this? Yeah, I mean, the best way to frame it is how these companies are spending their CapEx. And we know roughly, you know, one gigawatt of AI data center capacity costs about$50 billion. Again, it depends on the region, the source of energy and land, et cetera. But that's a rough ballpark. So when you think about 6.6 gigawatt, and we already know OpenAI has committed to, you know, about 26 gigawatts.

2:25So clearly, these companies have big ambitions. And what it suggests is a company like Meta, which will very well spend over$100 billion in CapEx this year in 2026, may stay on that path for at least the next three to four years because they believe they have a lot of applications when it comes to their own consumption of AI data centers. And they seem to be confident about their own model, which has so far trailed the likes of OpenAI, Anthropic, and Gemini in terms of capabilities. But it sounds like they want to make sure they have the capacity to deploy AI. And that's where nuclear is an interesting choice because a lot of the other hyperscalers have gone for more natural gas turbines.

3:13But we know there is a big backlog with someone like GE Varnova for their natural gas turbines. So from that perspective, nuclear is an interesting choice, you know, as an alternate. What are the big tech companies, these big AI companies saying about their confidence in the reliability of power in the next five, 10, 20 years? Because a lot of folks are saying that really could be the gating issue for the development and evolution of AI. Yeah, I mean, look, I was at CES where Jensen highlighted, you know, the reason why companies would upgrade quickly to the latest Rubin architecture is because they give, I mean, Rubin will give them more tokens per unit of power, which is really a way to emphasize the efficiency of how you utilize your available power.

4:08And so from that perspective, everyone sees very long lead times when it comes to adding new power. And they want to maximize, you know, the usage and utilization of whatever they have right now. And look, you could argue, you know, there are some other sources which may have shorter lead times like solar or battery packs. But in this case, given the size of power that these companies need for running, we're talking about one gigawatt data center. It's very hard to think about too many sources of energy that will give you that sort of power. And, you know, that's where the lead times are so long.

4:50Stay with us. More from Bloomberg Intelligence coming up after this.

4:57You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts or watch us live on YouTube. Let's get to the restaurant business here. You know, the flu season, which is upon us, and it's a little bit more harsh than average. It's impacting a lot of folks. Obviously, it's also impacting some businesses like the restaurant business. I didn't think of that. Michael Halen, he thinks of it. Senior restaurant and food service analyst for Bloomberg Intelligence.

5:30Mike, talk to us about recent trends in the restaurant biz. Yeah, it was a tough fourth quarter, you know, especially December. December was hurt by cold weather, snow and an earlier flu season. It's the worst flu season so far in 25 years. there's been some issues with you know the vaccines not not covering the current strains that are out there and so December was pretty rough you know quick service and fast casual did better quick service sales were were down slightly you know fast food chains like McDonald's and whereas fast casual like Chipotle Shake Shack they were up slightly in December it was the full service chain.

6:17So casual diners like Chili's and family dining like IHOP that struggle the most, which makes sense. If it's really cold or if it's snowing, you're less likely to go out to a restaurant and dine in. You're more likely to order Domino's. And so it all kinds of makes sense. But, you know, these trends are going to flip pretty nicely into January. We've seen a huge squeeze in restaurant stocks to open up this year. And we think it's going to continue. So what do these casual dining chains do to change the trajectory of what seems like a pretty set trend at this point? Well, casual dining chains had a really nice year in 2025.

7:03We, you know, they have, but because of that, they have tougher comparisons to lap, right? And so So for that reason, we think, you know, and we think QSR stands to benefit more from tax reform, as well as like a 10 percent-ish decline in oil prices. So we don't expect a bad year out of casual dining. We think they'll continue to do pretty well. They're going to, you know, they're not going to receive as much of a boost from Chili's, which had a, you know, an unbelievable year in 2025. but we think casual dining can have a solid year here in 26, but it's the casual dining names and some of the fast casual names we cover like Cava and Wingstop that we think can have a really nice bounce here, especially in the first half of 2026.

7:54Mike, we got some labor data today, some jobs data. Unemployment rate ticks down a little bit here. I got to think that's important for restaurant companies. Yeah, you know, labor has been tough for restaurants. You know, we've seen a 4 %-ish wage rate inflation in this industry, you know, going back to before the pandemic. You know, so labor continues to be kind of an issue. There's still some talk about restaurants being understaffed right now. So that obviously impacts service levels negatively and hurts the customer experience. So obviously something we look at pretty closely. In terms of names that you like, and I know we don't do buy, hold, sell recommendations at Bloomberg Intelligence, but the kinds of companies that are best positioned in 2026, what are you looking for?

8:52oh yeah so you know for us we're looking at chains that we think can outperform you know same store sales estimates on the street with some chains that we think you know other analysts are just not bullish enough on you know mcdonald's is coming up against some really easy comparisons due to e coli once they report the 4q and the 1q Wingstop, Brinker. These are some of the names that we've written about. Stay with us. More from Bloomberg Intelligence coming up after this.

9:26You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts or watch us live on YouTube. Boy, this transition to electric vehicles is proving very costly for automakers around the world. We had the big 20 plus billion dollar write-off from Ford a couple of weeks ago. Now General Motors will take another six billion dollars in charges tied to production cutbacks in its electric vehicle and battery operations. Let's break it down with Craig Trudell, Global Auto's editor for Bloomberg News.

10:04He joins us from our London office. Craig, what's GM telling us here about kind of their transition to EVs? Yeah, I think, you know, this is like a sort of ongoing toll that they're reporting. And I don't know that they're necessarily done. We heard them report actually some months back that, you know, sort of rethinking their production capacity and pairing that back in response to the way electric vehicle demand and, you know, battery supply was shaking out, that that was going to set them back more than a billion dollars. So this is, you know, an incremental amount of money on top of that. And there was some warning in the AK last night that actually, you know, there may be more to come.

10:51So, you know, I think this is part of a broader sort of rationalization taking place in the U.S. where, you know, an industry was trying to respond to an administration that was, you know, banging the drum in a much different way than the Trump administration is now. You know, I look at this trailing 12-month performance of General Motors. It's up 61 percent. That kind of tells me you can take as many charges as you want here. I want you to pare back your transitions to EV. Is that kind of what you're hearing? You know, it's fascinating because on one hand, you're seeing electric car leader or at least former electric car leader Tesla taking off and doing so in spite of the fact that their sales are slowing down.

11:36The outlook for EVs and their home market is pretty bleak. And yet you also in unison have sort of the contrarian play taking off in GM. I think, you know, it's maybe not quite that simple in that, you know, GM does have, I think David Welch's story on last night's news, does have, you know, sort of the context that they have quite a lot of electric vehicles available. They're going to continue to have a pretty broad, you know, range of cars. And Mary Barra has talked about how EVs is their, quote, North Star, and that that's not going to change. So I think there's going to be a little bit more stick-to-itiveness on GM's part than Ford.

12:17And yet I think this is also an indication that the market is saying, you know what, the way this company makes money is it's full-size pickups and SUVs. The more of those that they can make in this new paradigm, the merrier. So I guess give us a sense of in the US, I think we have an idea that this transition to EVs is going to take longer than maybe we initially thought. That's not the case, it seems like, in Europe. Tell us how the adoption is going in Europe. Yeah, I think actually last year it may be surprising to people because we ended the year with these headlines about the EU sort of backing off of its combustion engine van for 2035.

12:58That being said, we actually had a nice pickup in momentum for electric vehicles last year. A lot of that was driven by the Chinese manufacturers. I think that is part of where the concern is here that, you know, the, you know, local manufacturers in Europe, some of them are doing better than they were, but it is patchy. I think it's also patchy, you know, sort of country by country. But we did see, you know, a roughly 30 percent increase in battery electric vehicle sales last year, in spite of the fact that a big player in Tesla had a really tough 2025. That's interesting. You know, talk to us about hybrids here.

13:37I just caved and leased a hybrid for my number four offspring because he goes to school in California where the gas prices are just ridiculously high. A, the technology seemed really cool to me. The car drove great. And it seems like a nice mix between or a nice compromise between going full EV and full ICE. How do you think about it? Yeah, I mean, this was the supposed bridge technology and the bridge is going for a lot longer than I think a lot of people reckoned. And, you know, I remember, you know, covering Toyota being based in Japan for a few years, you know, Toyota taking a lot of heat for sort of clinging to, you know, this technology that it sort of pioneered with the Prius and, you know, not sort of jumping with both feet in fully electric vehicles.

14:23that has very much turned out to be to be the play. And I think we're seeing, you know, a lot of the excess battery capacity that got built in response to the Biden administration's push for, you know, more of a battery sector to be built in the U.S. A lot of that is going to get soaked up by these hybrids, whether they're whether they're plug in vehicles or not. If you can make, you know, the bigger pickups and SUVs that are already popular in the U.S. more efficient, you get sort of the best of both worlds. Even if there's a little bit of incremental cost on the front end, these vehicles are going to be much cheaper to refuel and better to run.

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