Global data centers dealmaking surged to hit another record high this year, driven by a rush to build out the infrastructure required for energy-intensive AI workloads.

That surge came even as investors grew increasingly wary of inflated artificial intelligence valuations and the financing underpinning the rapid expansion of data centers. Global stocks sold off in November as worries of an AI-fueled bubble persisted.

But S&P Global reported that more than $61 billion has flowed into the data center market this year, up slightly from $60.8 billion last year, amid what it called a “global construction frenzy.”

A surge in debt financing contributed to the record high as hyperscalers increasingly tap private equity markets rather than funding the expensive infrastructure themselves.

That trend has sparked concerns from some investors as they question the value of the advanced tech that data centers house.

Shares of cloud company Oracle fell 5% on Wednesday following a report that Blue Owl Capital was pulling out of a deal to back a $10 billion data center in Michigan. Oracle has denied the report, but Broadcom, Nvidia and Advanced Micro Devices retreated after it was published. The Nasdaq Composite lost 1.81% in its worst day in nearly a month.

Iuri Struta, TMT analyst at S&P Global Market Intelligence, said his team expects market concerns around AI and Oracle to be temporary and unlikely to have a “massive impact” on data center buildout and M&A in the near future.

“The competitive dynamic among frontier AI model providers, like OpenAI, Alphabet and Anthropic, is changing quickly, and this can have an impact on investor sentiment in public markets. But overall, we see demand for AI applications continuing to grow strongly in 2026.”

Despite the recent pullback in AI stocks, many analysts remain bullish on the sector. ING expects secular trends to point to healthy investment levels in 2026 driven by AI advancements and growing public and private support for digital innovation.

“There are two sides to the development of AI, one that would cater for optimism such as faster development of medicine and at the same time there would be concerns typically around (public) safety,” Wim Steenbakkers, global head of datacenters and technology at ING, told CNBC.

“Hence uncertainty remains around the monetisation of the technology and business models. Questions around the high levels of investment will only be answered in the future when the uncertainties diminish and the applications of the technology and its advantages become clearer.”

There were more than 100 data center transactions in the first 11 months of the year, whose total value already exceeds all the deals done in 2024, according to S&P Global Market Intelligence data. The majority of those deals took place in the U.S., followed by the Asia-Pacific region.

“In Europe, the buildout of data centers is expected to grow at a lower rate than other regions, but it remains to be seen if this results in an M&A rush amid scarcity of assets,” Struta said.

The pace of growth in the U.S. is leaving Europe “in the dust” according to a recent report from ING which predicted data center investment in the U.S. could be fivefold higher. Growth is also increasingly coming from the Middle East, as the wealthy Gulf States look to position themselves as the next global AI hub.

Debt issuance nearly doubled to $182 billion in 2025, up from $92 billion last year, according to the data from S&P. It noted that Meta and Google were among the most active issuers, with Facebook’s owner raising $62 billion in debt since 2022 — nearly half of that total was issued in 2025 alone.

Google and Amazon raised $29 billion and $15 billion, respectively, according to the report, which noted that hyperscalers are increasingly working with AI labs to buy assets to finance construction in an “unusual arrangement” that underscores the significant capital required to meet demand.

Struta expects more “robust” M&A investment activity in the data center space in 2026.

“I wouldn’t be surprised if already high valuations get even higher,” he told CNBC.

“The buildout of new data centers can be temporarily tempered by a lack of energy supply, making already built data centers more valuable. As the availability of large data center companies remains scarce, we could see more asset sales by companies that don’t view data centers as their core business.”

TikTok CEO Shou Zi Chew told employees on Thursday that the company’s U.S. operations will be housed in a new joint venture.

The entity is named TikTok USDS Joint Venture LLC, according to a memo sent by Chew and obtained by CNBC. As part of the joint venture, Chew said the company has signed agreements with the three managing investors: Oracle, Silver Lake, and Abu Dhabi-based MGX. He said that the deal’s “closing date” is Jan. 22.

Under a national security law, which the Supreme Court upheld in January, China-based ByteDance was required to divest TikTok’s U.S. operations or face an effective ban in the country. In September, President Donald Trump signed an executive order approving a proposed deal that would keep TikTok operational in the U.S. by meeting the requirements of a law originally signed by former President Joe Biden.

Chew noted that the new TikTok joint venture would be “majority owned by American investors, governed by a new seven-member majority-American board of directors, and subject to terms that protect Americans’ data and U.S. national security.”

The U.S. joint venture will be 50% held by a consortium of new investors, including Oracle, Silver Lake and MGX with 15% each. Just over 30% will be held by affiliates of certain existing investors of ByteDance, and 19.9% will be retained by ByteDance, the memo said.

The TikTok chief said the entity will be responsible for protecting U.S. data, ensuring the security of its prized algorithm, content moderation and “software assurance.” He added that the joint venture will “have the exclusive right and authority to provide assurances that content, software, and data for American users is secure.”

In addition to being an investor, Oracle will serve as the “trusted security partner” in charge of auditing and validating that it complies with “agreed upon National Security Terms,” the memo said. Sensitive U.S. data will be stored in Oracle’s U.S.-based cloud computing data centers, Chew wrote.

The new TikTok entity will also be tasked with retraining the video app’s core content recommendation algorithm “on U.S. user data to ensure the content feed is free from outside manipulation,” the memo said.

Chew noted that TikTok global U.S. entities “will manage global product interoperability and certain commercial activities, including e-commerce, advertising, and marketing.”

Under Trump’s executive order in September, the attorney general was blocked from enforcing the national security law for a 120-day period in order to “permit the contemplated divestiture to be completed,” allowing the deal to finalize by Jan 23.

WATCH: TikTok signs deal for sale of U.S. unit to joint venture

The VC arms of Google and Nvidia have invested in Swedish vibe coding startup Lovable’s $330 million Series B at a $6.6 billion valuation, the company announced on Thursday.

The news confirms an earlier story from CNBC, which reported on Tuesday that Lovable had raised at that valuation, trebling its valuation from its previous round in July, and that the investors included U.S. VC firms Accel and Khosla Ventures.

CapitalG, one of Google’s VC divisions, and Menlo Ventures led the round. Alongside Accel and Khosla, Nvidia venture arm NVentures, actor Gwyneth Paltrow’s VC firm Kinship Ventures, Salesforce Ventures, Databricks Ventures, Atlassian Ventures, T.Capital, Hubspot Ventures, DST Global, EQT Global, Creandum and Evantic also participated.

The fresh funds take Lovable’s total raised in 2025 to over $500 million.

“Lovable has done something rare: built a product that enterprises and founders both love,” said Laela Sturdy, managing partner at CapitalG in a statement accompanying the announcement.

“The demand we’re seeing from Fortune 500 companies signals a fundamental shift in how software gets built.”

Lovable’s platform uses AI models from providers like OpenAI and Anthropic to help users build apps and websites using text prompts, without technical knowledge of coding.

The startup reported $200 million in annual recurring revenue (ARR) in November, just under a year after achieving $1 million in ARR for the first time. It was founded in 2023 by Anton Osika and Fabian Hedin.

Vibe coding startups have seen big interest from VCs in recent times, as investors bet on their promise of drastically reducing the time it takes to create software and apps.

In the U.S., Anysphere, which created coding tool Cursor, raised $2.3 billion at a $29.3 billion valuation in November. In September, Replit hit a $3 billion price tag after picking up $250 million and Vercel closed a $300 million round at a $9.3 billion valuation.