The company plans to commit more than $7.5 billion to Canadian AI infrastructure over the next two years
Microsoft is betting that the next leg of AI growth will be built in data centres – and it is putting tens of billions into Canada and India to make that happen.
According to BNN Bloomberg, Microsoft plans to invest more than $7.5bn in Canada over the next two years as part of a broader $19bn commitment between 2023 and 2027 to expand its AI and cloud infrastructure in the country.
The company expects new capacity from this latest Canadian investment to come online in the second half of 2026.
Microsoft will use the Canadian outlay to expand its Azure Local cloud offering and deepen its partnership with Canadian AI startup Cohere, making the firm’s advanced AI models available through Microsoft’s Azure platform.
The company is also launching a dedicated “Threat Intelligence Hub” in Canada that will focus on cybersecurity protection and AI security research, and work with the federal government and lawmakers to track threat actors and organised crime.
Microsoft already employs more than 5,300 people across 11 cities in Canada.
The Canada plan sits inside an aggressive global investment cycle.
BNN Bloomberg reports that Microsoft has pledged hefty AI‑related investments worldwide this year as it races to secure more cloud computing capacity to meet surging demand for AI workloads.
Big Tech peers Amazon and Google‑parent Alphabet have also made multibillion‑dollar data‑centre commitments in the US and international markets.
At the same time, Microsoft is scaling up in other regions.
BNN Bloomberg notes that last month the company announced plans to invest US$10bn in AI infrastructure in Portugal and US$15bn in the United Arab Emirates.
The Windows‑maker reported record capital expenditure of nearly US$35bn for its fiscal first quarter in October and warned that spending would increase further this year, adding that it expects to remain constrained on supply at least until the end of its current fiscal year in June 2026.
According to Reuters, Microsoft on Tuesday unveiled US$23bn in new artificial intelligence investments, with the bulk earmarked for India as it deepens its bet on one of the world’s fastest‑growing digital markets.
Chief executive Satya Nadella said Microsoft would spend US$17.5bn in India over four years starting in 2026, building on a previous US$3bn commitment, in a move that would give the company the largest cloud‑computing presence in the country.
Microsoft plans a new hyperscale data centre region in Hyderabad, expected to go live in mid‑2026, alongside expansions of existing regions in Chennai, Hyderabad and Pune.
Reuters said Nadella framed the India spending as support to “build the infrastructure, skills, and sovereign capabilities needed for India’s AI first future,” and noted that the company has doubled an earlier pledge to equip 20 million Indians with essential AI skills by 2030.
Reuters also reported that Google plans to invest US$15bn over five years to build an AI data centre in the southern state of Andhra Pradesh, its biggest commitment in India, underscoring competition for AI infrastructure in the world’s most populous nation.
For the AI build‑out more broadly, Reuters reported that Microsoft and other major US cloud providers are expected to spend more than US$400bn on AI this year as they construct data‑centre capacity required for services such as ChatGPT, Copilot and Gemini.
However, BNN Bloomberg highlights growing concern that the rapid ramp‑up in capital spending, limited evidence so far of broad‑based productivity gains, soaring valuations and a web of circular investments are fuelling fears of an AI bubble.
Microsoft’s Canada investment plan is being made against an exchange rate of about $1 to 1.3841 Canadian dollars, sharpening the scale of its multi‑year commitments when translated between currencies.
For now, the company is pressing ahead with its AI infrastructure build‑out in Canada, India and other key markets as it tries to lock in capacity and defend its position in the global AI race amid rising investor scrutiny of whether these outlays will ultimately pay off.
