April 16 - Microsoft (MSFT, Financial) has put the brakes on several planned data center developments, including a newly greenlit site in Heath, Ohio, just weeks after gaining local support.
The company reportedly halted progress on at least three Ohio locations, including a $1 billion facility near Columbus, and has delayed or scrapped projects in other regions such as Illinois, North Dakota, Wisconsin, Indonesia, the UK, and Australia.
The abrupt shift follows reports that Microsoft recently walked away from hundreds of megawatts of leased power capacity for U.S. data centers, suggesting a broader reassessment of infrastructure needs.
While the company hasn't provided a detailed explanation, analysts point to tepid demand for generative AI services and a possible oversupply of capacity. In February, CEO Satya Nadella acknowledged AI had yet to deliver major returns, hinting at a mismatch between investment and usage.
Bloomberg also noted that Microsoft's evolving relationship with OpenAI may be influencing the decision. Earlier this year, Microsoft gave OpenAI the option to procure computing resources from rival cloud providers, shortly before OpenAI was linked to a separate $500 billion cloud project.
Microsoft has described the changes as part of long-term strategic planning.
