Artificial intelligence is a game changer—and a water guzzler. “AI represents one of the most prominent and fastest-expanding workloads in data centers,” write researchers from the University of California, Riverside, and the University of Texas at Arlington in a recent paper.
They note that
Alphabet’s
Google,
Microsoft,
and
Meta Platforms
used more than two billion cubic gallons of fresh water to cool servers and produce electricity last year, more than twice Denmark’s annual use. Training OpenAI’s generative model, GPT-3, in Microsoft data centers consumes 5.4 million liters of water over two to four weeks, and needs the equivalent of some 17 fluid ounces for a conversation of 10 to 50 questions and answers. “These numbers may increase for the newly launched GPT-4 that reportedly has a substantially larger model size,” they say.
The big tech companies tout “water stewardship” and becoming “net water positive,” pledging to replenish more water than they use by 2030. That’s a lot of water. Google said that in 2022, water consumption at data centers and offices was 5.6 billion gallons—the equivalent of irrigating 37 Southwestern golf courses annually. Microsoft has said it is tackling its 6.4 billion cubic meters in two ways: reducing water-use intensity—the amount of water per megawatt of energy—and replenishing supplies in water-stressed regions. Maybe Big Tech should throw some AI at the problem.
Write to Lauren Foster at lauren.foster@barrons.com
Last Week
Markets
Israeli troops moved into Gaza. China’s manufacturing activity unexpectedly fell in October. U.S. stocks rallied as the week began, and as the Federal Reserve paused. Job growth moderated and unemployment ticked up. Meanwhile, the
Bank of Japan
began loosening its cap on long-term rates, only to buy bonds to curb rising yields. It was 2023’s best week for stocks: the
Dow Jones Industrial Average
rose 5.1%, the
S&P 500
was up 5.9%, and the
Nasdaq Composite
climbed 6.6%.
Companies
President Biden signed an executive order mandating that artificial-intelligence companies share safety information. The holdout against the UAW,
General Motors,
agreed to a new deal featuring the same 25% pay hike as its rivals. Elon Musk’s X valued its equity at $19 billion, down from $44 billion a year after he bought it. Danish wind giant
Ørsted
dropped two big U.S. projects. Sam Bankman-Fried was convicted of seven counts of fraud and money laundering in the collapse of FTX.
Deals
The Wall Street Journal said former Marvel executive Isaac Perlmutter entrusted his stake in
Walt Disney
to Nelson Peltz’s Trian Fund Management, quadrupling its voting clout. Peltz wants board seats…The antitrust trial against
JetBlue
and
Spirit Airlines
began. The Justice Department sued to block the $3.8 billion merger…Shares in
WeWork
fell on a WSJ report that it would file for bankruptcy…Six Flags and Cedar Fair Entertainment are merging in a $2 billion all-stock deal.
Write to Robert Teitelman at bob.teitelman@dowjones.com
Next Week
Monday 11/6
Third-quarter earnings season winds down as only 50 S&P 500 index companies report this week, about a third of the total for this past week. It’s a busy week for large-cap biopharma stocks, with
Vertex Pharmaceuticals
and
BioNTech
announcing results on Monday.
Gilead Sciences
releases earnings on Tuesday, followed by
Biogen
on Wednesday, and
AstraZeneca
on Thursday.
Wednesday 11/8
Walt Disney reports fourth-quarter fiscal-2023 results. Analysts polled by FactSet are expecting the entertainment behemoth to earn 71 cents a share on $21.4 billion in sales. Disney’s shares are down 14.3% over the past year, the fourth-worst performer in the Dow, as declining linear-TV revenue and streaming losses offset the very profitable theme-parks segment.
Friday 11/10
The University of Michigan releases its Consumer Sentiment index for November. Consensus estimate is for a 63.9 reading, roughly even with the October figure and well below historical averages. Consumers’ expectations for the year-ahead inflation was 4.2% in October, a one percentage point jump from September and the highest reading since May.
Email: editors@barrons.com
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