Microsoft set to invest $80bn in AI data centres this year

The company disclosed the initiative in a blog post by president Brad Smith, who also urged the US to enhance its efforts to ensure global adoption of American AI technology over Chinese alternatives.

Smith said the investment underscored Microsoft's commitment to advancing AI infrastructure, which he described as essential for innovation.

More than half of the funding would focus on US-based facilities.

The expansion aligned with Microsoft's partnerships with AI firms like OpenAI, Anthropic and xAI, all of which rely on vast computational resources to develop and deploy advanced AI models.

Microsoft’s data centre footprint had already grown significantly, with over 5GW of capacity in 2023 and plans to add 1.5GW by mid-2025.

Despite that, reports indicated that OpenAI was exploring partnerships with other providers as demand outpaced Microsoft’s capacity.

The companies were also rumored to be planning a 5GW data centre, codenamed ‘Stargate’, projected for completion by 2028, according to Data Center Dynamics.

In his blog post, Smith emphasised the need for the United States to counter China’s strategy of subsidising AI infrastructure in developing countries, likening it to China’s dominance in telecommunications through companies like Huawei.

He warned that China's efforts to establish AI platforms in emerging markets could result in long-term reliance on Chinese systems.

To maintain a competitive edge, Smith advocated for US AI systems to be housed in secure, state-of-the-art data centres, promoted as superior alternatives.

He called for swift, coordinated action by the US government and its allies to ensure American leadership in AI technology.

At 0728 EDT (1228 GMT), shares in Microsoft Corporation were up 0.83% in premarket trading in New York, at $426.86.

Reporting by Josh White for Sharecast.com.