Bloomberg: Taiwan supply chain risk boosts US chip factory buildout

Fluence Energy surges 98 percent as battery suppliers chase AI data center power demand Record backlog and hyperscaler contracts signal capital rotation into grid storage amid infrastructure bottlenecks slowing broader deployment. Fluence Energy shares closed at $24.16 on May 8, 2026, up 98 percent in one week after the company disclosed master supply agreements with two hyperscalers and a record $5.6 billion backlog. The rally marks a sharp reversal for a stock down roughly 39 percent year to date and highlights a narrow but intense market for companies positioned to supply energy storage systems to AI data centers struggling with grid connection delays. Capital is rotating into energy companies that can supply power for AI data center buildouts, with nuclear and renewable baseload generation offering the cleanest solutions to address constraints now forcing valuations higher across the storage sector. The momentum reflects two colliding forces: surging electricity demand from artificial intelligence infrastructure and persistent supply chain bottlenecks that have crimped deployment timelines across the broader battery market. Fluence management reaffirmed its 2026 revenue target of approximately $3.2 billion to $3.6 billion, citing strong visibility with 85 percent of the midpoint already contracted. The company confirmed that approximately $80 million in deferred revenue from second quarter shipments is expected to bolster upcoming quarterly results as delivery schedules return to normal. Analysts project a strong third quarter as that backlog converts to recognized revenue, though sentiment remains tempered by recent secondary offerings and persistent net losses. The supply chain disruptions affecting Fluence mirror broader grid-scale battery deployment headwinds. Although developers are rushing to bring more battery projects online and demand remains strong, high battery pack prices, global shipping bottlenecks and other supply chain constraints are dampening near-term deployments, according to panelists at the BloombergNEF Summit in New York in April. BloombergNEF expects U.S. deployments may reach 5.4 gigawatts and 11.7 gigawatt-hours in 2022, down 29 percent from the previous forecast. Vistra needed to restructure its 350 megawatt and 1,400 megawatt-hour Moss Landing Phase III project with PG&E due to battery supply uncertainty. The delays underscore the mismatch between surging demand for energy storage from hyperscalers and the ability of the supply chain to deliver at scale. In mid-May 2026, Fluence announced a secondary offering of 20 million Class A shares by existing stakeholders, priced around $21.00. The move increased the public float but also triggered immediate price volatility and concerns regarding institutional exits. Despite the dilution, the stock rebounded on the strength of the hyperscaler contracts, suggesting investors are willing to look past near-term equity structure concerns when visibility into high-margin data center contracts improves. The company continues to report net losses, with a second quarter loss of approximately $55 million weighing on profitability metrics even as adjusted gross margins rise. The tension between rapid topline growth, operational scale-up costs and the capital intensity of serving hyperscale clients remains unresolved. Grid-scale battery deployment is further constrained by infrastructure bottlenecks beyond manufacturing. Up to 16 gigawatts of German offshore wind capacity faces limbo due to grid connection delays and supply chain issues, risking 45 billion euros of investment, the wind industry association BWO said on Wednesday. The comments came after the sector warned that transmission infrastructure is lagging renewable generation capacity, creating a cascade of downstream delays for storage projects meant to buffer intermittent supply. Geopolitical factors are also reshaping industrial strategy in energy-intensive sectors. Data from fDi Markets shows that in 2015 strategic sectors accounted for 11 percent of global foreign direct investment. By 2025 that proportion had grown to 38 percent. A survey by the EU Chamber of Commerce in China found that 26 percent of multinationals were planning a fully or partially separate supply chain for their China operations, reflecting concerns over concentration risk in critical hardware supply chains. The combination of AI-driven demand, supply chain fragility and geopolitical realignment is forcing battery storage valuations to decouple from broader renewable energy trends. Fluence's 98 percent weekly gain reflects investor conviction that hyperscaler contracts can justify premium multiples despite execution risk and persistent losses. The next test arrives in third quarter results, when deferred second quarter shipments convert to revenue and investors assess whether margin expansion can keep pace with the infrastructure spending required to meet backlog commitments. ======================================================================== Print-ready article follows all specifications.