Trump helped build the Middle East’s AI ambitions. Could his war break them?

President Donald Trump’s high-profile push last spring to enlist Big Tech in Gulf digital ambitions—accompanied by OpenAI CEO Sam Altman and Amazon CEO Andy Jassy—helped secure multibillion-dollar partnerships that positioned the UAE and Saudi Arabia at the center of a global race for artificial intelligence. Those plans now face immediate peril after drone and missile strikes linked to the Iran conflict targeted data centers in the United Arab Emirates and Bahrain, disrupting cloud services and raising questions about the region’s ability to host energy- and land-intensive AI infrastructure.

"If it goes on for a couple months, I think you have to reassess just about everything," said Paul Meeks, head of technology research at investment bank Freedom Capital Markets.

Context and recent developments

Gulf states including Saudi Arabia, the UAE and Qatar have committed tens of billions to AI infrastructure as part of post-oil economic strategies. Research and advisory firm Gartner projected technology spending in the Middle East would reach $155 billion in 2025, with $9.5 billion earmarked for data center investments—a nearly 70% increase from the prior year.

• Deals struck after Mr. Trump’s visit included multibillion-dollar partnerships between Amazon, Nvidia and Saudi Arabia’s state-backed AI startup Humain to build so-called "AI factories."
• In the UAE, agreements signed during the trip included plans to construct the largest data center complex outside the United States in Abu Dhabi.
• Iranian threats have explicitly targeted the "enemy’s technological infrastructure" and named companies including Amazon, Microsoft, Google, Oracle, Nvidia and Palantir.
• Amazon reported disruptions to its Bahrain data center services after earlier drone attacks on two of its UAE facilities and one in Bahrain; the company has helped customers migrate workloads to other regions as outages persist.
• Beyond direct strike risk, attacks on desalination plants—critical in the arid Gulf for providing cooling water—heighten vulnerabilities for data centers that rely on large water supplies.

"The war is leaving data center investment up in the air," said Ginger Matchett, a geostrategist at the Atlantic Council, noting that protections have historically focused on cyberthreats rather than physical drone or missile attacks.

Outlook

Analysts say the long-term case for Gulf AI remains strong if the conflict subsides swiftly. Marc Einstein, research director for AI at Counterpoint Research, said the region’s abundant energy, deep financial reserves and government backing make it "unmatched" for AI investment and that "they’re very resolute that the show is going to go on." Matt Garman, CEO of Amazon’s cloud computing division, told CNN he feels "as bullish as I ever have" about investing in the Middle East.

But others warn of a more cautious corporate response if the war drags on. Wedbush Securities analyst Dan Ives said, "If it’s elongated, they’re going to have to go to the drawing board, delay plans and look to curtail other plans." David Miller, chief investment officer at Catalyst Funds, added that an extended conflict could keep U.S. interest rates higher for longer, raising financing costs for tech investment.

How quickly governments and companies can weigh physical security upgrades, insurance and economic risks against the Gulf’s infrastructural advantages will determine whether the region’s AI ambitions proceed on schedule—or are forced to pivot.