Matt O’Brien
Microsoft said it is “slowing down or suspending” some of its data center construction, including a $1 billion project in Ohio.
Tech Giant this week has suspended an early stage project on rural land owned in Licking County, central Ohio outside of Columbus, and confirmed it will reserve two of its three farmland sites.
“In recent years, demand for cloud and AI services has increased more than we had anticipated, and we have begun running the largest and most ambitious infrastructure scaling project in our history to meet this opportunity.”
“A critical new effort at this scale and scale requires agility and refinement as you learn and grow with your clients, meaning you are delaying or suspending early-stage projects,” Walsh said.
Microsoft did not say that other projects were slowing outside of Ohio on Wednesday, but it was revealed in late December that it had suspended the late stages of Wisconsin’s large data center project.
Analysts at TD Cowen reported earlier this year that Microsoft had reduced some of its international data center expansion and cancelled several US leases due to the use of data centers run by other companies.
Other analysts have linked some of the changes to the changing relationship between Microsoft and business partner Openai, the maker of ChatGpt.
“We are a scientist at B. Riley Securities,” said Craig Ellis, research director.
On January 21, the companies announced that they changed their agreement that Microsoft became the exclusive provider of Openai’s computing power, allowing small businesses to build their own capabilities. President Donald Trump’s new launch promoted the partnership between Orkul and SoftBank, starting with a data center in Texas, pledging $500 billion in AI infrastructure with new US AI infrastructure.
Microsoft has long built data centers around the world to run cloud computing services. The Generated AI Boom has accelerated the demand for such facilities as trained new AI systems and millions of people began using chatbots and other AI tools at work and at home.
The computing required to run AI tools is expensive and requires a large amount of power. So, Trump cited this week as part of a justification that AI uses emergency authorities to boost the US coal industry, a reliable but polluted energy source. The tech company is also looking to leverage nuclear power, including a proposed Microsoft-backed revival of Pennsylvania’s shuttered three-mile island factory.
Microsoft said it plans to spend more than $80 billion globally globally to expand the fiscal year ending in June, and has already doubled the capacity of its data centers in the past three years.
“We may be strategically paced our plans, but we will continue to grow strong and allocate investments that align with business priorities and customer demand,” Walsh said.
Nonetheless, the Ohio suspension was disappointed by local officials.
Lisking County has also brought in data center investments from Microsoft Rivals Google and Meta Platforms, as well as highly anticipated semiconductor factories from Intel, but the struggling chipmaker in February has pushed back the expected completion date for the first phase of the project to 2030.
Original release: April 9, 2025, 2:18pm EDT
