The tech giants are pouring money into AI and data centers at an unprecedented pace. Microsoft, Amazon, Google, Meta — they’re all betting big, to the tune of over $100 billion in capital expenditures per year. The optimism is palpable: AI, the thinking goes, will transform industries and generate untold new revenue streams.
But amidst the fervor, a nagging question looms: are we on the verge of another tech bubble?
Wasif Khan has seen his share of market cycles. Over the course of his 25-plus years in finance, the CFO and co-founder of fiber optics provider Viafoton has weathered booms and busts from the vantage of Morgan Stanley trading floors, hedge fund offices, and now, the C-suite of a rapidly growing manufacturing business.
In a recent episode of the Manufacturing Executive Podcast, Khan shared his perspective on the AI and data center investment surge — and what it means for manufacturers trying to navigate an uncertain landscape.
“Nobody has a crystal ball,” Khan acknowledged. “And nobody can predict the future, right? So to your question about betting on the future, you have to use a set of frameworks to be able to say, OK, this thing should be stable. This thing is unlikely.”
The reality that nobody can get away from is nobody has a crystal ball. And nobody can predict the future, right?
For Khan, those frameworks are grounded in a fundamental view of risk. It’s not just about the stock market’s ups and downs, he argues, but about what ultimately happens to the money and time you put into something.
Take the US debt situation, for instance. With the country facing a choice between austerity and continued spending, Khan sees the latter as the more stable bet, given the political realities. Contrast that with the idea of data centers in space — an exciting prospect, perhaps, but one with far more unknowns and potential pitfalls.
Of course, even the most well-reasoned bets can go awry in a fast-moving market. Khan points to the overcapacity concerns currently swirling around the data center industry, drawing parallels to the mistakes of previous tech bubbles.
But he also sees a key difference this time around: the hyperscalers fueling the boom have fortress-like balance sheets and sticky, recurring revenue streams. They may slow their spend, as Microsoft recently did, but they’re unlikely to abandon their AI ambitions altogether.
For manufacturers caught in the middle of these swings, Khan offers some hard-won wisdom. Keep your fixed costs under control. Negotiate broad borrowing covenants to make time your friend. Maintain a flexible balance sheet. Manage your inventory risk. And perhaps most importantly, sustain your team’s morale and sense of purpose, even in the face of uncertainty.
It’s important to stay grounded when things are bad. It’s important to stay grounded when things are flying. In both environments, it’s important, because nothing is the same forever.
That last point is particularly close to Khan’s heart. At Viafoton, he’s made it a priority to build a culture that can thrive in fast-moving, high-stakes environments. That means giving young engineers real responsibility, even when it stretches them beyond their current capabilities. It means creating an environment that is challenging, fair, and meritocratic. And it means taking inspiration from high-performing teams like Navy SEALs and championship sports franchises.
For the young professionals entering this turbulent job market, Khan sees plenty of reason for optimism. The tools and platforms available today, he argues, allow for making a significant impact quickly — provided you bring the right mix of accountability, work ethic, and continuous learning to the table.
“The opportunity that sits for a 22-year-old entering the workforce right now is completely different than what existed for me,” he reflected. “And I’m very thankful for the opportunities that I’ve had over the course of my career, but I look at the opportunity that sits for the current generation — it’s incredible.”
Whether the AI and data center boom proves to be a bubble or a true paradigm shift, one thing seems certain: the manufacturers who will thrive in the years ahead will be those who can stay grounded in their values, adapt to changing circumstances, and bet wisely on the future — even when the crystal ball is cloudy.
“If you’re the kind of person who likes to challenge themselves and be in an environment where the sky’s the limit if you put the time in, please reach out,” Khan said of Viafoton’s own growth trajectory. “We’d love to hear from you.”
In a market this dynamic, that might be the safest bet of all.
To learn more about Wasif Khan and Viafoton, visit the company’s website or LinkedIn page. You can also catch Khan’s full conversation with host Joe Sullivan on the Manufacturing Executive Podcast, available wherever you get your podcasts.
