Microsoft Aims for 38-Gigawatt Data Center Power Surge by 2032

Microsoft plans to triple its data center power by 2032, underscoring the growing demand for cloud computing infrastructure. The tech giant currently has about 12 gigawatts of data-center capacity today, but aims to increase this to roughly 38 gigawatts in just eight years.

This massive expansion is driven by Microsoft's growing reliance on artificial intelligence (AI) and its associated computing needs. Currently, only around 2 gigawatts of Microsoft's data center capacity supports AI-focused chips, but the company expects this to make up about one-third of its targeted 38 gigawatts.

The sheer scale of Microsoft's plans is putting a spotlight on the company's spending habits. Building and leasing warehouses for servers is an expensive endeavor, even for a tech giant like Microsoft. To mitigate this, the company plans to change its accounting assumption by spreading certain long-term data center leases over 25 years instead of 15.

This shift in accounting will make it more difficult for analysts to track Microsoft's capital expenditures and lease obligations. However, it may also give investors a clearer picture of the company's cash outlays and ability to match demand with its ambitious plans.