Microsoft is looking to significantly expand the capacity of its data centers to serve the expected AI demand. The tech giant will triple the rate at which capacity is added as early as the start of the next financial year.

The boom in interest in mainstream models and generative AI is driving a surge in demand for additional computing power, as well as interest in training ever larger models.

According to documents available to Insider, Microsoft is preparing to address this by doubling Azure capacity in the second half of this fiscal year, which runs through the end of June.

Microsoft will triple additional data center capacity in the first half of its fiscal year 2025.

According to the aforementioned documents, the company is deploying a “record number of GPUs” to handle AI workloads, and more than doubled its total installed base of accelerators in the second half of last year.

Recall that Microsoft had intended last year to spend “many billions of dollars” building additional capacity in anticipation of the rapid increase in the number of customers looking to run generative AI projects.

By the end of 2023, Synergy’s data shows that the US accounts for 51% of global capacity as measured by MW of critical IT workload, Europe 17%, and China close behind with 16%.

The companies with the largest footprints are actually the big three cloud providers – Amazon, Microsoft and Google. They own 60% of all hyperscale data center capacity, followed by Meta, Alibaba, Tencent, Apple, ByteDance and other relatively small hyperscale operators.

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