You can’t scroll through a financial news feed today without seeing a headline about a major market segment, be it tech or industrials, getting completely reshaped by artificial intelligence. If you’re looking for the clearest, most direct way to invest in the AI revolution, you need to look beyond the graphics processing unit (GPU) makers and go straight to the powerhouse infrastructure that makes AI possible: data centers.
Think of it this way: AI is the brain and the data center is the nervous system. The explosive growth of AI has created an insatiable demand for powerful data centers.
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Companies are increasing their data center spending so fast that it’s difficult to keep up with current estimates. Still, investors can expect capital expenditures, or capex, by the “Magnificent Seven” mega-cap tech companies on AI and data center investments to hit $414 billion in fiscal 2025 and upwards of $430 billion in 2026, according to a Oct. 16 report from Matt Weller, global head of market research at StoneX and Forex.com. Looking beyond just the Magnificent Seven to include the entire tech industry, the Dell’Oro Group — an independent market research and consulting firm specializing in data center infrastructure — forecasts that data center capex will reach $1.2 trillion worldwide by 2029.
That kind of spending is bound to have huge knock-on effects on the U.S. and global economies. After all, building new data centers and upgrading old ones to handle AI involves the industrial sector, the materials sector, utilities, energy, defense companies, the real estate sector and, of course, the communications, information and technology sectors. In the final analysis, almost the entire market is — directly or indirectly — benefiting from the ongoing data center boom.
Not just any data center stock, exchange-traded fund (ETF) or real estate investment trust (REIT) will do, however. “In choosing the right company to invest in, it’s always important to look at the fundamentals of the company,” as opposed to the technicals of price charts, says Roland Chow, financial planner and portfolio manager at Optura Advisors in Burlingame, California. Fundamentals like revenue and balance sheet growth, valuation, occupancy rates and diversity of the customer base are key factors for long-term investors, he says.
With that in mind, here are seven of the best data center stocks, ETFs and REITs to buy now:
| STOCK/ETF/REIT | MARKET CAPITALIZATION | FORWARD YIELD AS OF DEC. 2 |
| Equinix Inc. (ticker: EQIX) | $71.6 billion | 2.6% |
| Digital Realty Trust Inc. (DLR) | $54.1 billion | 3.1% |
| Applied Digital Corp. (APLD) | $7.6 billion | N/A |
| Micron Technology Inc. (MU) | $259.8 billion | 0.2% |
| American Tower Corp. (AMT) | $82.1 billion | 3.9% |
| Microsoft Corp. (MSFT) | $3.5 trillion | 0.7% |
| Global X Data Center & Digital Infrastructure ETF (DTCR) | $622.9 million* | 1.4%** |
*Total assets, rather than market capitalization, are listed for this fund. **30-day SEC yield.
Equinix Inc. (EQIX)
Equinix is far and away the largest data center REIT in the world. The company has a market cap of $72 billion and operates more than 270 data centers on six continents. This includes colocation facilities and xScale hyperscale data centers in North America, the EMEA countries — Europe, Middle East and Africa — and the Asia-Pacific region.
Its centers act as a neutral “meet-me room” where the world’s major networks, cloud providers — AWS, Azure, Google Cloud — and enterprises physically and virtually connect. This concentration of partners, including Nvidia Corp. (NVDA) and Oracle Corp. (ORCL), creates a powerful network effect, making it difficult for competitors to replicate and driving consistent customer retention.
This powerful ecosystem is now the essential underpinning for AI and hybrid multi-cloud strategies. In addition to operating data centers, it provides products like Equinix Fabric, which supplies the fast, low-latency data exchange AI models need to run. By offering the physical space and high-speed connectivity required to run such compute-intensive workloads, Equinix is well positioned for future growth, regardless of which companies win the AI technology race.
Equinix has a “strong income statement, balance sheet and cash flow,” according to Chow. Third-quarter results were strong, with a 10% increase in adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) from Q3 2024 and a 14% increase in annualized gross bookings over Q2 2025.
Digital Realty Trust Inc. (DLR)
“Digital Realty is also another veteran in the space with strong financials and has a focus on AI-oriented leases,” Chow says. This global REIT is considered one of the largest dedicated providers of data center solutions. While Equinix dominates the interconnection market, Digital Realty is the leader in offering massive, power-heavy facilities for the world’s biggest cloud providers, such as Amazon.com Inc. (AMZN), Alphabet Inc.’s (GOOG, GOOGL) Google and Microsoft, to run their core infrastructure.
The company’s platform, PlatformDigital, spans over 300 data centers globally. It provides move-in-ready data center suites or build-to-suit models. Its high-density colocation provides the specialized power and liquid cooling solutions to support AI high-performance computing. The company is actively innovating in this area, including the launch of its Digital Realty Innovation Lab to help customers pre-validate high-density AI workloads before full-scale deployment, positioning it as a foundational layer for global AI “factories.”
The company “has been showing very strong backlog growth, which means there is an increasing demand for their services,” and their latest earnings call showed “strong growth guidance,” Chow says.
Applied Digital Corp. (APLD)
Applied Digital doesn’t have the size or scale of Equinix or Digital Realty Trust, but it still merits attention, according to Chow.
Applied Digital isn’t your grandfather’s data center; it’s a pure-play bet on the most intense, power-hungry segment of the digital economy: high-performance computing and AI. While established players like Equinix retrofit existing facilities, Applied Digital is purpose-building next-generation data centers, also known as AI factories, which are optimized from the ground up to handle massive GPU clusters and the liquid-cooling requirements that come with them.
The company is executing a rapid transition, moving away from its roots in cryptocurrency mining toward long-term, high-value contracts with hyperscalers and leading AI firms like CoreWeave Inc. (CRWV). This strategic pivot is underpinned by significant financial backing, including a massive preferred equity financing facility of up to $5 billion from Macquarie Asset Management, which underscores confidence in its ambitious growth plans. These plans involve developing multi-gigawatt campuses, such as the Polaris Forge sites in North Dakota, where the naturally cold climate and access to stranded, low-cost power give it a substantial operational edge.
The company’s strong quarterly revenue, up 84% from last year, has generated incredible gains for shareholders. The stock is up more than 267% year to date in 2025, a gain that may be strong enough to make up for the lack of dividend. That said, “valuation is probably a bit lofty right now,” Chow says, “and it would probably be a good idea to let this one pull back before investing.” Analysts are still bullish on it, though, even at its possibly inflated price.
Micron Technology Inc. (MU)
Of all the essential gears turning the AI machine, memory and storage are often overlooked, but they’re absolutely critical. That’s why Micron Technology deserves a serious look from any investor hunting for a foundational play in the data center boom.
The company “dominates high-bandwidth memory (HBM) and DRAM for AI servers, where data-intensive workloads require massive, low-latency storage,” according to Greg Harmon, professor at the Weatherhead School of Management at Case Western Reserve University. DRAM products are used in a variety of computing applications, from laptops to gaming consoles, but the real excitement right now is for its HBM, which supports the massive amounts of data needed by AI.
Micron’s HBM3E chips power Nvidia’s GPUs, “positioning it as a key enabler of AI training,” Harmon says. The tailwind created by the high demand for HBM chips has many analysts optimistic.
American Tower Corp. (AMT)
American Tower is the backbone of digital connectivity. While not strictly a data center REIT, it’s one of the world’s largest independent owners of communication real estate. The company owns and operates more than 149,000 wireless communications sites globally, including cell towers, distributed antenna systems and data center facilities. American Tower serves as the landlord, providing the physical space for mobile carriers to deploy their network equipment.
The company benefits from the highly attractive long-term, non-cancellable tenant leases that often span 10 years or more and include built-in annual escalations. This combination results in a remarkably predictable, inflation-resistant cash flow stream. The ongoing global rollout of 5G networks and the growing demand for edge computing, which brings processing data closer to the user, guarantee sustained demand for the company’s tower and fiber assets. Analysts are largely bullish on the company’s future.
Microsoft Corp. (MSFT)
The list of the best data center stocks wouldn’t be complete without at least one tech behemoth. Microsoft is arguably the most critical stock to include on your list, not as a direct REIT, but as the primary driver of data center demand. Its strength lies in its dominance of the hyperscale cloud market with Microsoft Azure, and its leadership position in the burgeoning generative AI space through its partnership with OpenAI and its Copilot platforms.
Microsoft’s fundamental strength is powered by the scale and profitability of its Cloud segment, which generates enormous revenue growth. This segment requires unprecedented capital expenditures to build out its global data center footprint to support the intense power and computing demands of AI models like GPT-4. So, by investing in MSFT, you’re indirectly investing in the same value proposition provided by data centers.
Its strong balance sheet, highly profitable software products, like Office365, and unique strategic positioning at the intersection of AI, cloud and software make it a fundamental anchor for any digital infrastructure investment theme.
Global X Data Center & Digital Infrastructure ETF (DTCR)
Finally, when investing in any new industry or hot sector, diversification is often the best approach. Stocks like APLD may have incredible returns one year, then stagnate or fall the next as they battle fierce competitors. Why put all your bets on one company or REIT, when you could invest in two dozen? This is what DTCR provides.
The data center ETF holds 25 stocks, including all of the stocks listed above except Microsoft. You’ll also get professional management to ensure your portfolio keeps up with the ever-changing tides in the data center and AI industries. The downside is that the price of this diversification and professional management is a 0.5% expense ratio. That cost can be easily overcome if it continues to have strong performance, as in 2025, when it’s up about 26% year to date.
Don’t expect an entirely smooth ride, however. DTCR is still a high-risk and concentrated bet with a tendency toward more volatility than its peers. If you’re bullish on data centers and invested for the long haul, though, it definitely merits a look.
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7 Best Data Center Stocks, ETFs and REITs to Buy originally appeared on usnews.com
