Microsoft is planning to invest about US$80-billion (R1.5-trillion) in its 2025 financial year on developing data centres to train artificial intelligence models and deploy AI and cloud-based applications, the company said in a blog post on Friday.
Investment in AI has surged since OpenAI launched ChatGPT in 2022, as companies across sectors seek to integrate the technology into their products and services.
AI requires enormous computing power, pushing demand for specialised data centres that enable tech companies to link thousands of chips together in clusters.
Microsoft has been investing billions to enhance its AI infrastructure and broaden its data centre network.
Analysts expect Microsoft’s fiscal 2025 capital expenditure including capital leases to be US$84.2-billion, according to Visible Alpha.
The company’s capital expenditure in the first quarter of fiscal 2025 rose 5.3% to $20-billion.
As OpenAI’s primary backer, the tech giant is considered a leading contender among Big Tech companies in the AI race due to its exclusive partnership with the AI chatbot maker.
More than half of Microsoft’s $80-billion investment will be in the US, vice chairman and president Brad Smith said in the blog post.
Read: Microsoft faces wide-ranging US antitrust probe
“Today, the US leads the global AI race thanks to the investment of private capital and innovations by American companies of all sizes, from dynamic start-ups to well-established enterprises,” Smith said. — Harshita Mary Varghese, (c) 2024 Reuters
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