Microsoft Commits $10 Billion to AI Data Hub in Portugal

Microsoft has announced plans to invest US$10 billion in artificial intelligence infrastructure at a new data center in Sines, Portugal. This investment, which represents one of the largest AI projects in Europe, aims to enhance the country’s capacity for AI development over the next few years.

The tech giant will collaborate with several key partners, including developers Start Campus, AI infrastructure platform Nscale, and semiconductor manufacturer NVIDIA. The partnership will see the deployment of 12,600 next-generation NVIDIA Graphics Processing Units (GPUs) in Sines, located approximately 150 km (or 93 miles) south of Lisbon.

Investment Details and Strategic Importance

Start Campus, a joint venture between the U.S. investment fund Davidson Kempner and the UK-based Pioneer Point Partners, previously announced plans in April to invest €8.5 billion (approximately $9.9 billion) by 2030 in a data center hub. This hub is designed to meet the increasing demand from major technology and AI companies. Currently, one of the six buildings planned is already operational.

Brad Smith, Microsoft’s Vice Chair and President, emphasized the significance of this investment by stating, “By strengthening the national AI infrastructure through collaboration with Nscale, NVIDIA, and Start Campus, we are helping to position Portugal as a benchmark for the responsible and scalable development of AI in Europe.”

Portugal’s strategic location along the Atlantic coastline makes it an ideal hub for subsea cables that connect Europe, Africa, and the Americas, supporting the global internet infrastructure. Additionally, large-scale investment projects are underway in Sines to produce green energy, which will be crucial for powering energy-intensive data centers.

Growing Demand for AI Infrastructure

The surge in investments in data centers can be traced back to the launch of OpenAI’s ChatGPT in 2022. As businesses across various sectors increasingly transition to cloud-based operations and integrate AI technologies, the demand for robust data center capabilities continues to grow.

This significant investment by Microsoft not only underscores the company’s commitment to advancing AI infrastructure but also highlights Portugal’s emerging role as a center for technology and innovation in Europe. As companies seek to enhance their AI capabilities, projects like this are expected to play a vital part in shaping the future of artificial intelligence on the continent.