Holding a $100 billion contract but still without power to its data center? Nscale is a UK-based data center company focused on AI cloud computing, deploying GPUs and leasing out computing power. Microsoft ($MSFT) is one of its key customers. Just as Nscale was preparing for a $35 billion IPO in the U.S., Microsoft withdrew from the project. The project has faced repeated delays, with power supply not expected until 2030. Yet I came across an intriguing conspiracy theory: Some claim Microsoft is merely using the power issue as an excuse—that actual AI demand simply isn’t that high. They argue this is just a convenient pretext to cut future AI spending, suggesting AI revenues can’t justify the massive construction costs. After reviewing this analysis, I find it plausible that AI revenues may not be sufficient to support such enormous investments. As we discussed yesterday, bonds from companies like $ORCL and $CRWV are seeing rising yields, signaling that investors are demanding higher risk premiums. In Nscale’s IPO filings, of $103.4 billion in contracts, only $2.6 billion has been brought online so far—the rest are future commitments. Actual revenue in the first half of 2026 was just $140 million. With so much debt and such massive contracts signed, yet still no power—there’s real uncertainty about whether they can deliver on time and start generating profits. This is definitely an industry risk worth closely monitoring.