3 AI Infrastructure Stocks Built for Higher Rates and Data Center Demand

Oil near crisis levels, hotter inflation at 3.4% and a fresh Fed rate hike have turned the AI and automation story into more than a tech narrative. It is now a stress test for big U.S. platforms that claim their tools can cut costs and keep demand intact when borrowing is expensive and sentiment is weak. This piece walks through three large AI focused stocks exposed to those macro shocks and explains why each might deserve a closer look right now.

The three AI and automation stocks highlighted below are only a starting sample, and the wider screen surfaced another 25 large U.S. platforms with equally compelling narratives that are not covered in this article. If you want to move past headlines and actually compare balance sheet strength, earnings quality and AI exposure side by side, head straight to the U.S. Large-Cap AI and Automation Leaders screener.

Sterling Infrastructure (STRL)

Overview: Sterling Infrastructure builds and prepares large sites for data centers, e-commerce hubs, manufacturing plants and transport projects that support AI driven infrastructure.

Operations: Sterling Infrastructure generates about US$2.44b from e-Infrastructure Solutions, US$613 million from Transportation Solutions and US$385 million from Building Solutions, all in the United States.

Market Cap: US$15.68b

Sterling Infrastructure matters in this AI and automation screen because it pours the concrete, lays the utilities and shapes the land under many of the data heavy projects driving the theme.

"Record-high and growing backlog, particularly in E-Infrastructure Solutions (up 44% year-over-year to $1.2 billion), coupled with a robust pipeline of future phase work approaching $2 billion, provides strong multi-year revenue visibility and stability, mitigating downside risk to revenues and supporting sustained earnings growth."

What happens to that earnings path if a single key assumption about future mega project demand or pricing power breaks?

If that assumption matters to you, read the full narrative for Sterling Infrastructure to see how Sterling Infrastructure’s backlog, pricing, and project mix could accelerate or stall under tougher conditions.

Microchip Technology (MCHP)

Overview: Microchip Technology supplies smart, connected, and secure embedded chips and tools that sit inside AI enabled devices, automation equipment, and industrial IoT systems worldwide.

Operations: Microchip Technology generates about US$4.95b from Semiconductor Products and US$173 million from Technology Licensing, with revenue spread across Asia, the Americas, and Europe.

Market Cap: US$40.61b

Microchip Technology matters in this AI and automation screen because its controllers, FPGAs, and timing parts are the quiet plumbing that let data center hardware, industrial robots, and connected factories run AI workloads at the edge.

"Microchip Technology is seeing structural expansion in data center and AI infrastructure exposure, with total data center revenue expected to increase from about US$591 million in 2025 to roughly US$1 billion in 2026 and PCIe Gen6 design wins, including an estimated US$100 million annual program starting in 2027, which together point to a larger contribution to future revenue."

What that means for investors depends on how one unseen squeeze on capacity and costs resolves just as this higher value mix ramps.

That supply squeeze is only the start, and the full narrative for Microchip Technology shows how Microchip Technology’s AI mix, pricing power, and capital needs could be quietly decoupling from the cycle.

Teradyne (TER)

Overview: Teradyne designs automated semiconductor test equipment and collaborative robots that help power AI hardware production and industrial automation worldwide.

Operations: Teradyne generates about US$3.72b from Semiconductor Test, US$386 million from Product Test, and US$356 million from Robotics across global electronics and automation markets.

Market Cap: US$59.65b

Teradyne matters in this U.S. Large-Cap AI and Automation Leaders screener because its test platforms and robots sit directly in the production lines that turn AI chip designs and automated factories into working hardware.

"Teradyne expects significant future growth potential from AI accelerators, robotics, and semiconductor automation, which are being driven by long-term industry themes such as AI, verticalization, and electrification. Tariffs and trade policies are creating uncertainty among Teradyne's customers in the mobile, automotive, and industrial segments, potentially reducing demand and impacting future revenue projections."

The next leg of that story depends on how one pressure on customer investment plans ultimately feeds through to test capacity and robotics demand.

As that spending pressure builds, read the full narrative for Teradyne to see how Teradyne’s AI test and robotics story could be quietly accelerating beyond headline risk.

Seeking Fresh Alternatives Before They Fly

New themes can gain momentum quickly, and potential entry points may not remain available for long. Some ideas are already flying under the radar for now, so consider them while they are still relatively quiet.

• Track resilient cash generators before yields are compressed and income-focused investors concentrate on the 7 dividend fortresses that emphasize durability as well as payout strength.
• Scout potential future growth stories early by scanning the 16 high quality undiscovered gems that highlight lesser known businesses with robust fundamentals and capacity for fresh institutional attention.
• Prepare for potential volatility spikes by reviewing the 30 resilient stocks with low risk scores and focusing on companies that score well on financial strength while prices still reflect hesitation.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com