Microsoft plans to spend $80 billion in fiscal 2025 building data centers that can handle AI workloads, the company said in a Friday report. blog post.
More than half of the planned spending on AI infrastructure will be in the United States, wrote Microsoft vice president and president Brad Smith. Microsoft’s 2025 fiscal year ends in June.
“Today, the United States leads the global AI race thanks to private equity investment and innovations from American companies of all sizes, from dynamic startups to well-established companies,” Smith said. “At Microsoft, we’ve seen this firsthand through our partnership with OpenAI, from startups like Anthropic and xAI, and our own AI-enabled software platforms and applications.”
Several top tech companies are rushing to spend billions on Nvidia Graphics processing units to train and run AI models. The rapid spread of OpenAI’s ChatGPT assistant, which launched in late 2022, started the AI race for companies to offer their own generative AI capabilities. Having invested more than $13 billion in OpenAI, Microsoft provides cloud infrastructure to the startup and has incorporated its models into Windows, Groups, and other products.
Microsoft reported $20 billion in capital expenditures and assets acquired under financial leases worldwide, with $14.9 billion spent on property and equipment, in the first quarter of fiscal 2025. Capital expenditures will increase sequentially in the fiscal second quarter, Microsoft Chief Financial Officer Amy Hood said. in October.
The company’s revenue from Azure and other cloud services grew 33% year over year, and 12 percentage points of that growth came from AI services.
Smith called on President-elect Donald Trump’s incoming administration to protect the country’s leadership in AI through education and promotion of American AI technologies abroad.
“China is starting to offer developing countries subsidized access to scarce chips and promises to build local AI data centers,” Smith wrote. “The Chinese wisely recognize that if a country standardizes on China’s AI platform, it will likely continue to rely on that platform in the future.”
He added: “The best response for America is not to complain about the competition, but to ensure that we win the race ahead of us. “This will require us to act quickly and effectively to promote American AI as a superior alternative.”
LOOK: Microsoft plans to spend $80 billion to develop AI this year
