Jim Cramer explains why no AI stock seems safe from the market carnage

CNBC's Jim Cramer said Thursday that uncertainty over the future of a data center build-out has made artificial intelligence stocks increasingly difficult to value, leading to the steep selling over the past two sessions.

The sell-off swept across the AI trade, hitting everything from chipmakers to companies supplying power and electrical equipment for data centers. The iShares Semiconductor ETF (SOXX) fell 3% Wednesday and another 10% Thursday, while GE Vernova and Sandisk dropped 7% and 22%, respectively, on Thursday. Investors are concerned that regulatory hurdles and opposition to new data centers could slow the build-out, undermining the growth forecasts supporting chipmakers' valuations.

"We don't know what to pay for any of the stocks connected to the data center and that's why this moment is so fraught," the "Mad Money" host said.

Cramer pointed to Nvidia as a prime example. The AI chipmaker trades at roughly 12 times next year's earnings with an expected growth rate of 70%, making it appear remarkably cheap. But those earnings projections assume demand will remain strong for years to come.

"That's an incredible bargain," he said. "But it is not a bargain if, the following year, it can't grow any further, because the U.S. won't permit new data centers as fast as they do now."

Memory maker Micron also faces risk. The company's long-term take-or-pay contracts provide some revenue visibility even if customers don't take delivery of their chips. However, Cramer said he's unsure how sturdy those contracts would be if any signees fell on especially hard times and didn't have the money to pay.

Advanced Micro Devices presents another valuation dilemma. Cramer praised its latest earnings as "one of the best quarters I have ever seen" and highlighted CEO Lisa Su's projection that the broader data center market could eventually reach $1 trillion.

"If that's the case then you can buy her [CEO Lisa Su's] stock right now," Cramer said. "Do you want to? The stock was at $188 in March. By that token, $404 seems awfully high to me. Maybe that's the real problem."

Ultimately, Cramer said the question is whether regulatory hurdles will significantly slow data center construction or merely delay it. Until the outlook becomes clearer, even exceptional earnings outlook may not be enough to justify AI stocks' valuations.