Microsoft plans to spend S $109.5 billion on data centres this fiscal year

Microsoft plans to spend $80 billion on data centers this fiscal year, underscoring the huge demand for capital for artificial intelligence.

Microsoft President Brad Smith wrote in a blog post Friday that more than half of the projected spending through June 2025 will be in the United States. Smith writes that recent advances in artificial intelligence (AI) are due to "massive infrastructure investments that are an important foundation for AI innovation and use."

Cloud infrastructure providers such as Microsoft and Amazon have been racing to expand computing capacity by building new data centers. In the last fiscal year ending June 2024, Microsoft's capital expenditures amounted to more than $50 billion, the vast majority of which related to the construction of server farms driven by the demand for AI services.

Smith said that AI is in many ways the driving force of this era, and that the next four years can lay the foundation for the next 25 years of economic success in the United States, and he cautioned the incoming Trump administration against "heavy-handed regulation" of AI, calling on Trump and Congress to expand support for AI innovation through measures such as increasing research funding for universities and the National Science Foundation. "America's most important public policy priority should be to ensure that the US private sector can continue to ride the waves," he wrote.

He pointed out that China and the United States are racing to spread their AI systems to other countries, and this race for international influence is likely to be won by the fastest first mover, so the United States needs a smart international strategy to quickly support American AI around the world.