Microsoft is scaling back its data center initiatives globally, as reported by Bloomberg, indicating a cautious approach towards the rapid expansion of its cloud computing infrastructure. The company has either suspended discussions or postponed the development of data centers in locations including the U.K., Australia, North Dakota, Wisconsin, and Illinois. A Microsoft spokesperson stated that the company plans its projects years in advance, and these adjustments reflect “the flexibility of [its] strategy.”
Earlier this year, in February, Microsoft had reaffirmed its commitment to invest over $80 billion in capital expenditures for 2025, primarily targeting AI data centers. However, as highlighted by Bloomberg, it remains unclear whether this recent slowdown is due to anticipated lower demand or temporary construction hurdles, such as shortages in power supply and building materials.
Additionally, Microsoft has indicated a shift in its expansion strategy for 2025, opting to enhance existing data centers with servers and other computing equipment rather than focusing on new construction.
