Microsoft Rejects Multibillion-Dollar AI Expansion Deal With Nscale at Texas Facility

Microsoft has declined an option to expand its artificial intelligence infrastructure contract with UK-based cloud provider Nscale at a facility in Ward County, Texas, the Financial Times reported. The rejected deal, valued in the billions to tens of billions of dollars, would have more than doubled Microsoft's existing capacity agreement. The decision follows Microsoft's earlier cancellation of a $3 billion lease at Nscale's Essex, UK site due to power grid delays. The setback comes as Nvidia-backed Nscale prepares for a planned $35 billion US initial public offering despite posting a $1 billion first-half net loss.