Microsoft to invest $80b in AI data centres this year

Microsoft Corp. is ramping up its infrastructure investments, as it announced plans to spend $80 billion this fiscal year to expand its data centre footprint, driven by the surging demand for artificial intelligence.

More than half of this capital will be allocated to projects in the United States, according to a blog post by Microsoft President Brad Smith on Friday. Smith emphasised that recent advancements in AI are fueled by “large-scale infrastructure investments that serve as the essential foundation of AI innovation and use,”

Tech giants like Microsoft and Amazon are racing to expand their cloud computing capabilities, with Microsoft’s spending marking a significant leap from the $50 billion it allocated in the fiscal year ending June 2024, mostly directed toward server farm construction. This surge in investment reflects the growing demand for AI-driven services.

Balancing Innovation and Policy
Smith urged the incoming Trump administration to avoid “heavy-handed regulations” on AI, advocating for policies that enable innovation. “The most important US public-policy priority should be to ensure that the US private sector can continue to advance with the wind at its back,” he wrote.

He also called for a balanced export control policy to safeguard security while allowing US companies to grow and maintain robust supply chains for allied nations.
Much of Microsoft’s investment will support high-powered chips from companies like Nvidia Corp. and infrastructure partners such as Dell Technologies Inc. To meet the energy demands of its massive AI-enabled data centers, Microsoft has taken bold steps, including a deal to reopen a reactor at Pennsylvania’s Three Mile Island nuclear power plant—once the site of a historic partial meltdown.

Other tech leaders like Amazon and Google have also inked nuclear power agreements, underscoring the high-energy requirements of the AI revolution.

Attribution: Bloomberg