Microsoft to Invest $18 Billion to Expand Australia's AI Capacity by 2029 -- Update
MSFT
Published on 04/22/2026 at 11:37 pm EDT
By Kimberley Kao
Microsoft will invest $18 billion in cloud and artificial-intelligence infrastructure in Australia by the end of 2029, marking its largest ever investment in the country.
The U.S. tech company said Thursday that it plans to invest 25 billion Australian dollars, equivalent to US$17.90 billion, to significantly expand its Azure AI supercomputing and cloud infrastructure in Australia.
Azure provides cloud services to a vast array of businesses.
"Australia has an enormous opportunity to translate AI into real economic growth and societal benefit," Satya Nadella, Chairman and CEO of Microsoft, said in a statement.
Microsoft said it is also committed to strengthening AI safety and will train three million locals with AI skills by 2028.
"Our National AI Plan is all about capturing the economic opportunities of this transformative technology while protecting Australians from the risks," Australian Prime Minister Anthony Albanese said.
Microsoft's latest spending plan builds on an A$5 billion investment from October 2023, which the company used to grow its Australian data center presence to 29 sites across three Azure cloud regions.
The investment is a structural tailwind for local data-center and digital infrastructure companies, said Josh Gilbert, Asia-Pacific market analyst at eToro.
"Microsoft's Copilot is losing ground to Claude and Gemini, and Satya Nadella is not spending out of generosity. This is about defending Azure's turf," said Gilbert.
Companies across sectors are increasing spending to integrate AI into operations, though many face challenges in implementation and in demonstrating returns on their investments.
"The training commitment for 3 million Australians is smart because the biggest bottleneck in AI adoption right now isn't the tech, it's the people who need to know how to use it," said Gilbert.
The announcement follows recent similar plans by Microsoft to invest in Japan, Thailand and Singapore.
Major U.S. technology companies--including Microsoft, Meta Platforms, Amazon and Alphabet's Google--are expected to collectively spend up to $670 billion this year on AI infrastructure to expand computing capacity.
Investors' patience are being tested with these elevated capital expenditures, Gilbert noted.
"Investors want to see returns, not just bigger numbers, and next week's [earnings] results will be the first real test of whether the AI trade still has room to run," he said.
Write to Kimberley Kao at [email protected]
(END) Dow Jones Newswires
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