European infrastructure and data center stocks are outperforming traditional tech, rallying 23% this year

European data centers and infrastructure companies are gaining a lead over traditional tech companies in the stock market. The enthusiasm for AI was reignited this week following global partnerships involving Nvidia Corp., pushing the MSCI All-Country World Index to an all-time high. 

Twelve companies, including Accelleron Industries AG, Arcadis NV, Legrand SA, National Grid Plc, Nokia Oyj, Orange SA, OVH Groupe SA, Prysmian SpA, Siemens Energy AG, and Veolia Environnement SA, have surpassed traditional tech companies like Nvidia, Microsoft, and Apple in percentage gains this year. 

AI infrastructure trades boom in Europe 

A custom basket of ten European data center operators, grid providers, and infrastructure companies has surged 23% this year, outpacing both the 12% gain in the Stoxx Europe 600 Index and the Nasdaq 100. The Stoxx 600 Technology Index has gained only 6.7% this year.

However, the 23% surge is still significantly lower than the 69% jump in U.S. power stocks. The basket includes major players such as Accelleron Industries AG, Arcadis NV, Legrand SA, National Grid Plc, Nokia Oyj, Orange SA, OVH Groupe SA, Prysmian SpA, Siemens Energy AG, and Veolia Environnement SA. 

“It’s not as sexy to talk about infrastructure as it is to talk about some of the big U.S. tech names,” Helen Jewell, the Chief Investment Officer for EMEA fundamental equities at BlackRock, said. “But we are literally just at the beginning of it. Power infrastructure, grid stability, energy efficiency—that is the AI story in Europe, less on the software side.”

Investors light up stocks powering AI

As artificial intelligence models grow more complex, they demand vast energy resources, which is advantageous for power and infrastructure companies.

Siemens Energy AG, for instance, has seen its shares soar 111% this year, making it a top pick in Ninety One’s European equity fund, which manages $192B in assets. 

“It is absolutely mission critical in getting power from the grid to data centers,” Ben Lambert, the fund manager at Ninety One, said. 

Despite the gains, Siemens Energy still trades at a 60% discount to its U.S. peer GE Vernova Inc., based on price-to-earnings ratios.

The energy firm’s prospects were boosted in January when President Donald Trump announced a joint venture between SoftBank Group, OpenAI, and Oracle Corp. to fund billions of dollars in AI infrastructure. Siemens, GE Vernova, and Mitsubishi Heavy Industries together account for over 70% of global gas turbine production capacity.

The Italian cable manufacturer Prysmian SpA has also benefited from AI-driven infrastructure demand. Its stock has surged 41% in 2025, trading at 20 times forward earnings, which is a significant discount to chip-equipment leader ASML Holding NV, which trades at 35 times. Prysmian’s cables are key for transmitting electricity and data across growing AI networks.

Legrand SA, a French producer of electrical and digital infrastructure, has seen its shares climb 52% this year after raising full-year sales guidance in July. About 20% of its revenues now come from data centers. 

“We’re seeing European industrials really benefit from the surge in data center growth driven by AI,” Alexandra Sentuc, the European equity portfolio manager at JPMorgan Asset Management, said.

Telecom firms like Orange SA, France’s largest telecom operator, manages over 70 data centers, and plans to expand its AI-ready capacity. Similarly, Nokia Oyj is a critical part of Europe’s AI infrastructure due to its network switch technology used in data centers. Morgan Stanley analysts estimate that Nokia’s 2026 revenue could rise by €300M if hyperscaler-linked sales continue to grow.

“It’s still a tangible play from the geopolitical standpoint,” Xiadong Bao, the co-manager of the Edmond de Rothschild Fund Big Data, said. He noted that European governments prefer local suppliers over U.S. or Chinese switch makers.

Despite the optimism, challenges like thin liquidity and limited passive investment exposure to infrastructure-focused AI themes raise concerns for investors. There’s also regulatory scrutiny around AI and energy use that could also temper growth.

However, both public and private investments are accelerating. Nvidia is expanding its European footprint with new technology centers in the U.K., France, Spain, and Sweden. 

“The AI world is a bit like the Cold War, where everybody wants to get to the moon,” Bao said. “But for us, especially European investors, it’s better to look at the AI race as a marathon—monetization will increase progressively.”

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