Kristina Roberts
Artificial intelligence company Nscale has entered into a major agreement with Microsoft to supply around 200,000 Nvidia AI chips. These powerful chips will be deployed across Microsoft’s data centers located in Europe and the United States. The company made the announcement on Wednesday, marking one of the biggest partnerships in the fast-growing field of artificial intelligence technology.
Although Nscale has not shared the exact amount of money involved in the deal, reports from The Financial Times suggest that it could be worth up to $14 billion. This shows how valuable AI technology has become for big companies like Microsoft, which is investing heavily in AI development to support tools like Copilot, ChatGPT, and other advanced systems powered by large-scale computing.
The agreement will be carried out in collaboration with Dell Technologies, another leading name in global computing. Working with Dell will help Nscale set up and manage these AI systems more efficiently across Microsoft’s data centers. Microsoft has not yet given any official statement about this partnership, but the move clearly reflects its ongoing efforts to strengthen its position in the global AI race.
Starting next year, Nscale will begin supplying Nvidia’s high-performance graphics processing units (GPUs) to Microsoft through its data centers in Texas and Portugal. These GPUs are key components used in training and running AI models. They help computers process large amounts of data quickly, making AI tools faster and smarter. Nscale also has plans to expand its Texas operations over the next few years to handle the rising demand for AI computing.
This new deal builds upon Nscale’s previous announcements. Earlier, the company revealed that it had formed a joint venture with Norway’s Aker, a well-known industrial investment company. That partnership aimed to supply Microsoft with about 52,000 Nvidia GPUs from Nscale’s hyperscale AI campus in Narvik, Norway. The new contract is therefore a big step forward, increasing the total number of chips being provided to Microsoft and expanding their reach beyond Europe.
In September, Nscale raised about $1.1 billion from investors, including Aker and Finland’s Nokia, to speed up the construction of its advanced data centers. These data centers will serve as the backbone for hosting and running AI models, cloud computing, and other large-scale digital operations. This large investment shows how much confidence investors have in Nscale’s technology and its ability to compete in the global AI infrastructure market.
The use of Nvidia AI chips is central to this partnership. Nvidia is the world’s leading supplier of GPUs designed for artificial intelligence, gaming, and data processing. Its chips are used by almost every major AI company, including OpenAI, Google, Meta, and Amazon. These chips help in performing billions of calculations per second, which is essential for training AI systems that can understand language, generate images, and even simulate human behavior.
With this deal, Nscale is positioning itself as one of the major players in the global AI infrastructure industry. The company’s goal is to build large-scale, energy-efficient data centers that can handle the ever-growing demand for AI processing power. The rise of generative AI tools like ChatGPT has created an explosion in demand for such computing capacity. Microsoft, one of the early investors in OpenAI, has been leading this trend by integrating AI features into its products such as Microsoft Office, Azure Cloud, and Bing search engine.
For Microsoft, this agreement comes at a time when AI competition among tech giants is heating up. Companies like Google, Amazon, and Meta are all racing to develop better AI models and faster computing systems. To stay ahead, Microsoft needs a steady and reliable supply of powerful chips and infrastructure to support the growing number of AI-based services it offers. Partnering with Nscale ensures that it can continue to grow without facing hardware shortages, which have become a serious problem in the AI world.
The collaboration between Nscale, Nvidia, and Dell shows how multiple global companies are now working together to shape the future of artificial intelligence. Each company brings its own strengths — Nvidia provides the hardware, Nscale offers the data infrastructure, Dell helps manage and deliver the systems, and Microsoft applies all these resources to create new AI-driven technologies.
This deal is also important for Europe and the U.S. because it helps balance the concentration of AI infrastructure, which has largely been centered in a few countries. By building data centers in multiple locations, Nscale and Microsoft can improve speed, security, and reliability for their AI operations. Moreover, having centers in different regions allows them to meet local data regulations and support sustainability goals.
As Nscale expands its data center operations, it also plans to focus on green energy solutions. The company aims to reduce the carbon footprint of its AI infrastructure by using renewable energy sources like wind and hydroelectric power. This approach is becoming increasingly important because AI computing consumes large amounts of electricity, and companies are under pressure to make their operations more environmentally friendly.
The growing partnership between Nscale and Microsoft also reflects a broader trend in the tech industry — the shift toward long-term collaborations rather than short-term supply deals. AI is not just about software anymore; it requires a deep and reliable hardware foundation. By forming multi-year agreements, companies like Microsoft can secure their AI future while partners like Nscale can continue to innovate and scale up their capabilities.
Nscale’s journey has been remarkable for a company that started only a few years ago. With strong financial backing, top-tier partners, and access to cutting-edge technology, it is quickly becoming a trusted name in the world of AI infrastructure. Its focus on building massive, sustainable, and high-performance data centers could make it one of the most important players in the next generation of computing.
This latest deal with Microsoft could also open doors to new collaborations with other global tech leaders. As the demand for AI continues to grow, companies like Nscale that specialize in creating the backbone for AI systems will play a crucial role in shaping the future of technology.
In short, this partnership is not just about supplying 200,000 Nvidia AI chips. It represents a much bigger movement — one where technology companies are joining forces to build the infrastructure that will power the world’s AI-driven future. With Nscale’s expertise, Nvidia’s technology, and Microsoft’s global reach, this collaboration could set new standards for what’s possible in artificial intelligence.
