Meta President Says Midterm Results Will Make Building Data Centers Harder

Getting data centers built is “going to be harder” after the midterm elections, said Meta META 1.44%increase; up pointing triangle Platforms President Dina Powell McCormick—but perhaps not as hard as it now appears.

Speaking at the WSJ Tech conference on Wednesday, Powell McCormick said “many different factors” played into the Democrats’ widespread victories, with data center opposition front and center in many campaign ads and exit polls.

But she offered an anecdote to suggest some of the politicians who ran and won opposing them may be ready to negotiate.

“We did have a governor that won last night who did make data centers a big part of their platform say, ‘As soon as we get past the inauguration, let’s meet because we don’t want to lose this investment in our town. We don’t want these jobs to go elsewhere,’” she said.

Meta is racing to build out enough computing power to operate personal agents for its 3.6 billion users. Chief Executive Mark Zuckerberg has said he sees the agents, called Muse, as the centerpiece of Meta’s vision for the future and is spending loftily to make it a reality—up to $145 billion in capital expenditures this year.

The company is building a massive data center in Louisiana called Hyperion, another one in Ohio called Prometheus and a third in Texas, as part of a venture with BlackRock. The governors-elect of Ohio and Texas have both called for conditional freezes on new data center construction.

Powell McCormick said she expects there is “going to be a lot more review” of new projects. “What I mean by that is to start new data center build-outs today in the United States will be very challenging.”

But she said companies like Meta would have an easier time expanding existing data center projects “because you’ve had a major track record for a few years, and the community has felt those benefits. They haven’t felt cost. They’ve actually felt benefits.”

Powell McCormick, who said she spends 80% of her time working on securing computing power, said the company is also looking to other countries, where it might be able to build data centers in a more friendly environment.

“I can also tell you that every hyperscaler is now thinking about ‘Do we need to build outside the United States?’ Because they’re enormous investments, hedging those investments is a wise thing to do,” she said.

The company recently embarked on a campaign to raise more money for its ambitious AI data center plans right as the market has started to get nervous about all the spending.

Last month, Meta announced plans to create a new class of nonvoting stock to use in future equity raises. The following week, the company unveiled a plan to raise up to $97.5 billion through a series of new stock offerings. The funding raises come after Meta reported negative free cash flow for the first time since 2012, the year it went public.