Microsoft skirts around rumors that it has cancelled several data center projects worth billions of dollars

Date:
Mon, 31 Mar 2025 17:33:00 +0000

Description:
A new report says that Microsoft has cancelled yet more data center projects worth billions of dollars.

FULL STORY

We recently reported Microsoft had cancelled leases with at least two private data center operators in the US, totaling a couple hundred megawatts, and how the company was also not converting so-called statements of qualifications
into leases, according to claims from TD Cowen analysts.

Shortly after that news broke, Microsoft pulled out of a $12 billion deal
with CoreWeave (the "WeWork of AI" ), passing on buying more data center capacity from the AI hyperscaler. That option was snapped up by OpenAI, but
as it counts Microsoft as its biggest backer, it was essentially paying CoreWeave with Microsoft money!

Microsoft appears to be taking a more tactical approach to AI spending, a
move that is echoed in a new Bloomberg report quoting TD Cowen analysts
saying Microsoft has walked away from additional data center projects in the
US and Europe.

On track to spend $80 billion

Bloomberg writes, Microsofts retrenchment in the last six months included lease cancellations and deferrals, the TD Cowen analysts said in their latest research note. Alphabet Inc.s Google had stepped in to grab some leases Microsoft abandoned in Europe, the analysts wrote, while Meta Platforms Inc. had scooped up some of the freed capacity in Europe.

Responding to the article, Microsoft pointed out that it was still on track
to spend about $80 billion investing in growing infrastructure projects.

Thanks to the significant investments we have made up to this point, we are well positioned to meet our current and increasing customer demand, a
Microsoft spokesperson said in a statement.

While we may strategically pace or adjust our infrastructure in some areas,
we will continue to grow strongly in all regions. This allows us to invest
and allocate resources to growth areas for our future.

Bloomberg adds TD Cowen analysts Michael Elias, Cooper Belanger, and Gregory Williams said, We continue to believe the lease cancellations and deferrals
of capacity points to data center oversupply relative to its current demand forecast.

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Link to news story: https://www.techradar.com/pro/microsoft-skirts-around-rumors-that-it-has-cance lled-several-data-center-projects-worth-billions-of-dollars

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