Editorial

Picks & Shovels No. 00: The Gold Rush Is Real. Sell the Shovels.

Hyperscalers are on track to spend roughly $725 billion or more on capital projects in 2026. Most of that money doesn’t go to chatbots — it goes to turbines, switchgear, chillers, lasers and cables. A new Boston Made storyline follows the shovel sellers.

Published

3 hours ago

October 1, 2026

Founder & Chairman of Boston Made, Inc.

Picks & Shovels No. 00: The Gold Rush Is Real. Sell the Shovels.

EDITORIAL & ANALYSIS · Boston Made Newsroom · BOSSTOX intelligence desk

In 1849 the miners got the headlines. The people selling picks, shovels, denim and passage west got paid. The AI boom is running the same play at a much bigger scale. This storyline follows the companies selling the shovels.

The size of the dig

At first-quarter 2026 earnings, Meta, Alphabet, Microsoft and Amazon guided to roughly $725 billion of combined 2026 capital spending (The Wealth Advisor, Apr 30, 2026). Three months later most of them raised it again. Amazon moved to about $220 billion and Alphabet to $195–205 billion, citing “an acceleration in the delivery of capacity.” Meta lifted its floor to $130–145 billion (Uncover Alpha, Aug 3, 2026).

None of that money buys a chatbot. It buys concrete, copper, steel, silicon and electricity.

Power is the real bottleneck

The International Energy Agency projects global data-centre electricity demand reaching about 945 TWh by 2030, more than double today’s level. It also expects data centres to account for almost half of U.S. electricity-demand growth over that period (IEA, Energy and AI).

The grid is already showing the strain. PJM, which runs the grid for 13 states and D.C., held its 2027/28 capacity auction and cleared at its price cap. It still came up 6,623 MW short of its reliability target, and data centers drove nearly 5,100 MW of the forecast load growth (PJM Inside Lines, Dec 17, 2025). Lawrence Berkeley National Laboratory counts more than 2,060 GW of projects waiting in U.S. interconnection queues (LBNL, Queued Up 2026).

The map of the shovels

Every AI data center needs the same stack, from the ground up:

Land and buildings: powered campuses ready for racks (No. 08, Applied Digital)
Power generation: turbines and on-site fuel cells (No. 01, GE Vernova; No. 02, Bloom Energy)
Power distribution: switchgear and e-houses (No. 09, Powell Industries)
Cooling: chillers and coolant distribution (No. 03, Modine)
Connectivity: lasers, transceivers, active cables (No. 04, Lumentum; No. 05, Credo)
Raw materials: indium phosphide wafers for lasers (No. 10, AXT)
Making and proving the chips: advanced packaging and burn-in testing (No. 06, Amkor; No. 07, Aehr Test Systems)

How to read this storyline

Each installment answers four questions: what the company does, which shovel it sells, what the latest numbers say (with the period and source) and what could go wrong. We skip the names everyone already knows. The goal is to see the AI economy as an industrial system you can verify, not a story about a single chip.

This is the same thesis behind The Infrastructure of Power and the BOSSTOX AI Infrastructure Intelligence Graph. Picks & Shovels is the reading version: one company per chapter.

PICKS & SHOVELS is a Boston Made Newsroom storyline from the BOSSTOX intelligence desk: one under-covered AI-infrastructure company at a time, explained in plain English with sources. Next: No. 01, GE Vernova.

📚 Follow the whole storyline on the Boston Made Reader → Storylines · Track the companies in BOSSTOX Learn.

Not investment advice. Boston Made, Inc. and its writers are not licensed financial advisors. Figures come from the company filings and reports linked above, for the periods stated; check the primary filings before making any decision.

Related Topics:AI infrastructure BOSSTOX Picks & Shovels

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Picks & Shovels No. 01: GE Vernova Sells the Electricity Before It Exists

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Founder & Chairman of Boston Made, Inc.

Founder of Boston Made, Inc., a Boston-based media and business portfolio company. I lead Boston Made's independent, hyperlocal coverage of Boston's economy, businesses, and neighborhoods, alongside a growing portfolio of Boston-rooted brands — including Boston Made Pets, where my passion for dog wearables and canine wellness lives on. I’m an avid reader and journaler who believes in reporting that's closer to home.

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Editorial

Picks & Shovels No. 10: AXT, the Wafer Under the Laser Under the Cloud

The lasers in AI optics start as indium-phosphide wafers. AXT makes them, and its InP revenue jumped from $3.6 million to $30.7 million in a year. Lumentum and Coherent have paid deposits to secure supply.

Published

3 hours ago

October 1, 2026

Founder & Chairman of Boston Made, Inc.

Picks & Shovels No. 10: AXT, the Wafer Under the Laser Under the Cloud

PICKS & SHOVELS · No. 10 · Specialty materials

Follow the supply chain far enough down and you reach a wafer of indium phosphide. Almost nobody makes it.

What it does

AXT Inc (NASDAQ: AXTI) makes compound-semiconductor substrates, mainly indium phosphide (InP) and gallium arsenide wafers. Most of the production happens at its China-based subsidiary, Tongmei.

The shovel it sells

The raw InP wafers that laser makers like Lumentum and Coherent need to build the lasers inside AI transceivers. This is the bottom layer of the optical stack.

What the numbers say

Q2 2026: revenue was $47.6 million, up 164% year over year. InP revenue was $30.7 million, up from $3.6 million a year earlier.
Q3 2026 outlook: about $66 million in “realizable revenue,” with upside that depends on more Chinese export permits.
Capacity plan: quarterly InP capacity rising from about $20 million to $60 million by year-end and more than $130 million by the end of 2027.
Customers: supply agreements with prepayments or deposits from Lumentum ($43.5 million), Coherent ($25.4 million) and Casella ($22.3 million).

Sources: Semiconductor Today, Aug 4, 2026; SEC 8-K.

What could go wrong

It depends on Chinese export permits for InP.
Manufacturing based in China brings geopolitical and tariff exposure.
Small scale and concentrated customers.

Season one, wrapped

Ten companies, one chain: turbines and fuel cells make the power, switchgear routes it, chillers remove the heat, packaging and burn-in turn silicon into reliable chips, lasers and cables connect them, and a wafer company in the basement makes the lasers possible. Season two looks at Coherent, Fabrinet, Ciena, Astera Labs, Eaton, nVent and Amphenol. Start again at No. 00.

📚 Follow the whole storyline on the Boston Made Reader → Storylines · Track the companies in BOSSTOX Learn.

Editorial

Picks & Shovels No. 09: Powell Industries and the 3x Book-to-Bill Nobody Noticed

A Houston switchgear maker booked $934 million of orders in one quarter — three times its revenue — including a $400 million-plus data-center order. Backlog hit $2.4 billion.

Published

3 hours ago

October 1, 2026

Founder & Chairman of Boston Made, Inc.

Picks & Shovels No. 09: Powell Industries and the 3x Book-to-Bill Nobody Noticed

PICKS & SHOVELS · No. 09 · Switchgear

Between the power plant and the server sits a lot of steel cabinets full of breakers. Without them, nothing switches on safely.

What it does

Powell Industries (NASDAQ: POWL) engineers custom electrical equipment, including switchgear, motor-control centers and prefabricated “e-houses,” that distributes high-voltage power safely in plants, utilities and now data centers.

The shovel it sells

Medium-voltage gear, including the packages that tie on-site generation into a campus. That’s the same bring-your-own-power trend from No. 02.

What the numbers say

Fiscal Q3 2026 (ended Jun 30, 2026): revenue was $312 million, up 9%. New orders were $934 million, up 158%.
Book-to-bill: 3.0x. Backlog was $2.4 billion, up 69% year over year.
The orders include a data-center order worth “exceeding $400 million” for behind-the-meter on-site generation assets.
Management cited “increasing demand to support data centers and related AI capacity demand.” A yard expansion is due to finish by the end of fiscal 2026.

Source: Powell 8-K, Aug 3, 2026.

What could go wrong

A long history of oil, gas and petrochemical cycles.
Large fixed-price projects carry margin risk.
Capacity is tight with a backlog this big.
The big data-center orders are concentrated in a few customers.

Why it’s under-covered

Energy analysts have followed Powell for decades. AI analysts mostly haven’t found it yet.

📚 Follow the whole storyline on the Boston Made Reader → Storylines · Track the companies in BOSSTOX Learn.

Editorial

Picks & Shovels No. 08: Applied Digital, the Landlord of the Prairie

A former crypto host now has 1,410 MW of AI capacity under contract and about $36 billion in base-term lease revenue. Applied Digital builds powered campuses in North Dakota.

Published

3 hours ago

October 1, 2026

Founder & Chairman of Boston Made, Inc.

Picks & Shovels No. 08: Applied Digital, the Landlord of the Prairie

PICKS & SHOVELS · No. 08 · Powered land

Cheap power, cold air and room to grow. North Dakota has all three, and that makes it valuable AI real estate.

What it does

Applied Digital (NASDAQ: APLD) develops large, purpose-built AI data-center campuses, branded “Polaris Forge,” and leases the capacity to hyperscalers and GPU clouds on long contracts.

The shovel it sells

Powered, finished buildings ready for racks. That’s the hardest thing to buy quickly in AI right now.

What the numbers say

Fiscal Q4 2026 (ended May 31, 2026): revenue was $258.7 million, up 407%. Fiscal 2026 revenue was $611.3 million, up 167%.
Contracted capacity: 1,410 MW across five campuses. That’s about $36 billion of revenue over the initial 15-year terms, or about $86 billion if every renewal is exercised.
Customers: CoreWeave, plus a new investment-grade U.S. hyperscaler with about $20 billion of contracted revenue across three leases.
Operations: 175 MW live at Polaris Forge. It completed a $2.15 billion offering of 6.75% senior secured notes.

Sources: Applied Digital FY2026 results, Jul 27, 2026; 10-K.