Whale Rock Capital has been quietly climbing the leaderboard by leaning into the AI boom, keeping a hefty stake in Alphabet while shifting capital into the power and grid plays that will fuel the next wave of data center growth. The fund trimmed some of last year’s biggest winners and rotated into mid-cap infrastructure names, with Advanced Energy Industries emerging as a notable new holding. That mix of mega-cap AI exposure and utility-scale bets explains why the market is suddenly paying attention to this once-middling manager.
Whale Rock’s portfolio moves reflect a clear view: AI isn’t just about chips and models, it’s a full-stack transformation that needs energy, power conversion, and upgraded grids to scale. The fund’s top holding is Alphabet, which has surged and now sits as a core position. Alphabet’s gains have drawn attention not only from hedge funds but from long-term holders who see its role across software, hardware, and infrastructure for AI.
Alphabet’s rally—up roughly 123% over the past year—has made it the kind of anchor that lets a manager take tactical swings elsewhere. While Alphabet soaks up headlines, Whale Rock has been harvesting gains from other hot names, trimming positions in several stocks that ran hard. Taking profits has freed capital to chase assets that stand to benefit from the next phase of AI-driven demand.
That rotation shows up in how Whale Rock pared back stakes in Sandisk, Celestica, and Corning after massive runs, while redeploying funds toward companies tied to grid modernization. Those three winners posted astronomical returns over the past year, and some rebalancing was inevitable. The result is a portfolio that still leans on AI leaders but also captures the midstream infrastructure story that will be required as data centers proliferate.
Advanced Energy Industries landed on Whale Rock’s buy list as a Q1 addition, and it’s easy to see why. The company, a mid-cap specializing in power conversion, measurement, and control equipment, is squarely in the supply chain that keeps data centers humming and grids stable. It’s a business less glamorous than chips, but arguably more essential when it comes to delivering reliable power at scale.
Advanced Energy is down around 16% from its highs yet has climbed roughly 180% over the trailing year, making it a standout rebound story with ongoing demand tailwinds. At a forward price-to-earnings multiple near 36.5, the stock trades with growth expectations baked in, but it still feels cheaper than many of the pure-play AI hardware names. That positioning attracted other hedge funds in the last quarter, signaling smart-money interest beyond just Whale Rock.
The analyst who called NVIDIA in 2010 just named his top 10 stocks and Advanced Energy wasn’t one of them.
That well-placed note underlines the point that consensus views on AI winners are still forming and that some valuable pieces of the ecosystem sit off the beaten path. Power conversion and grid equipment won’t headline a tech summit, but they will headline capital budgets when companies plan new data center campuses and when utilities upgrade transmission to handle concentrated loads. Investors who miss that wave may find the physical constraints outpace even the boldest forecasts for compute demand.
Valuation and risk tolerance will determine whether Advanced Energy fits an investor’s portfolio. As a mid-cap, the name can swing more than the giants, offering higher upside if grid and data center spending accelerates, and sharper downside if expectations slip. For managers like Whale Rock that blend long-term mega-cap stakes with opportunistic mid-cap buys, that volatility is part of a deliberate playbook rather than a bug.
What’s notable is the signal this strategy sends: the AI story isn’t a single trade, it’s a set of interlocking markets where chips, software, cooling, storage, and power all matter. Whale Rock’s moves suggest the next performance chapters may belong to firms that quietly supply the infrastructure needed for the AI era, even as Alphabet and other platform giants remain the headline acts. Investors watching the space should expect continued rotation as capital chases the specific pieces that make large-scale AI practical and profitable.
