Microsoft Targets 38-Gigawatt Data Center Expansion by 2032

Microsoft (MSFT) is reportedly planning to expand its global data center capacity by more than tripling its current footprint from roughly 12 gigawatts to over 38 gigawatts by 2032. According to Bloomberg News, citing people familiar with the plans, the company expects AI-specific chips to make up around one-third of the total capacity by then.

The move comes as Azure and other cloud services revenue increased 43% year-over-year in fiscal Q4, reaching $59.3 billion for the quarter and $214.4 billion for fiscal 2026. Microsoft's commercial remaining performance obligations also rose 84% to $678 billion, providing a significant pool of committed business to support the expansion.

However, the massive infrastructure project will require enormous capital commitments, with Microsoft expecting over $50 billion in capital expenditures in fiscal Q1 2027 and around $175 billion for calendar 2026. The company must also secure enough electricity and navigate growing regulatory resistance across multiple jurisdictions.