The surge in demand for artificial intelligence (AI) technologies is profoundly reshaping the landscape of data centers, necessitating a new wave of innovation in their architecture and operational frameworks. At the forefront of this transformation is Nvidia, a leading provider of AI computing platforms, which is driving the development of next-generation data centers designed to accommodate the rising computational needs associated with AI workloads. Nvidia is not navigating this evolution in isolation; it has enlisted the expertise of key partners, notably Navitas Semiconductor and Vertiv, to enhance the implementation of its vision for 800-volt high-voltage direct current (HVDC) data centers.
In a recent communication via its corporate blog, Nvidia detailed its strategic transition from traditional 54-volt DC data centers to cutting-edge 800V DC systems. This significant shift aims to revolutionize how data centers operate by simplifying power delivery and improving operational efficiency. Nvidia anticipates that these new data centers will be formally launched by 2027, underlining the urgency for its partners to devise compatible solutions in advance.
In the current paradigm of data center operations, power management has historically relied on a complex hierarchy of conversion processes. Here, power supplied at 13.8kV in alternating current (AC) must first be stepped down before being distributed at a lower AC voltage. This power is then converted to 54V DC for use in IT racks housing graphics processing units (GPUs). The proposed 800V HVDC approach fundamentally alters this dynamic by allowing for a more streamlined conversion process. By enabling the direct conversion of 13.8kV AC power to 800V DC at the data center’s perimeter, the new architecture facilitates direct distribution to IT racks, where it can be further converted into lower voltages suitable for GPU operation.
Nvidia delineates several advantages associated with the implementation of 800V HVDC data centers, including a projected efficiency improvement of approximately 5%. Additionally, the new infrastructure is expected to significantly reduce copper demand, lower maintenance costs by up to 70%, decrease cooling requirements, and ultimately trim the total cost of ownership by 30%. These efficiencies position Nvidia as a pioneer in a sector increasingly defined by pressing energy concerns and operational upkeep.
In this transformative journey, Navitas Semiconductor emerges as a pivotal player. After reporting sales of $83.3 million in 2024, the announcement of its collaboration with Nvidia propelled its stock price over 100% in a single year. Specializing in gallium nitride (GaN) and silicon carbide (SiC) semiconductor technologies, Navitas capitalizes on its expertise in developing power conversion solutions that seamlessly integrate with the structure of the new data centers, covering the gamut from initial perimeter conversion to IT rack-level voltage adjustments.
Competitors such as Infineon and STMicroelectronics also vie for prominence in this burgeoning market, yet Navitas has the advantage of being a pure-play company focused exclusively on GaN and SiC technologies. This specialized focus positions it well to benefit from the anticipated growth associated with 800V HVDC implementations, although the volatility in its stock valuation reflects uncertainties regarding long-term revenue projections.
Vertiv, another essential ally in this endeavor, plays a critical role in the design and supply of robust infrastructure necessary for 800V HVDC systems. The company is currently developing industrial-grade rectifiers essential for converting 13.8kV AC power into 800V DC, in addition to IT rack-level converters and backup power systems. Vertiv’s anticipated release of its new solutions in the latter half of 2026 aligns strategically with Nvidia’s rollout of its advanced Kyber and Rubin Ultra platforms for the new data centers.
Having transitioned from its roots as a subsidiary of Emerson Electric to a stand-alone public entity after being sold to private equity and re-entering the market in 2020, Vertiv operates within a competitive landscape that includes industry heavyweights like Eaton and Schneider Electric. Despite these competitive pressures, Vertiv’s focus on the evolving market for AI-driven data centers has encouraged a favorable outlook, with analysts projecting mid-teens revenue growth through 2027. This optimistic sentiment is buoyed by expectations of new order influxes likely to occur in 2026, setting the stage for substantial growth amid the transition to the advanced data center frameworks.
While there are warranted concerns regarding the potential for overheating in the AI/data center sectors, the dynamic shift toward next-generation data centers is poised to expand the total addressable market in significant ways. As organizations grapple with the escalating demand for computational power, the collaborative efforts among Nvidia, Navitas, and Vertiv signal a revitalization of the entire data center ecosystem. The implications of this evolution extend well beyond individual company performance, potentially reshaping investment strategies and operational methodologies within the broader technology and infrastructure landscapes.
Engaging with the intricacies of this technological advancement requires a nuanced understanding of both the financial metrics involved and the overarching industry trends. The interplay of innovation, efficiency, and partnership will define how companies adapt to the rapidly shifting demands of AI and high-performance computing in the coming years. Investors, stakeholders, and industry observers alike will be watching closely as these developments unfold, informed by a mix of strategic foresight and careful execution in the high-stakes realm of data center evolution.