Microsoft to invest $18 bln in Australian AI and cloud expansion

Microsoft will invest A$25 billion (US$18 billion) into Australian digital infrastructure by the end of 2029, a capital injection the company described as its largest single investment in the country.

According to an official press release by Microsoft, the spending targets an expansion of Azure AI supercomputing capacity and cloud services across Australia, with plans to boost commercial cloud and graphics processing unit offerings for local customers by more than 140% before the decade ends.

Satya Nadella, Microsoft's chairman and chief executive, announced the commitment in Sydney alongside Prime Minister Anthony Albanese. "Australia has an enormous opportunity to translate AI into real economic growth and societal benefit," Nadella said. "Microsoft's long-term investment in our national capability will help deliver on our National AI plan," Albanese said, pointing to strengthened cyber defences and new opportunities for Australian workers and businesses.

As per Microsoft, the pledge builds on a A$5 billion investment unveiled in 2023, which expanded Microsoft's Australian data centre footprint to 29 sites across three Azure regions. The earlier wave also established the Microsoft-ASD Cyber Shield and delivered digital skills training to more than one million Australians.

Under the expanded arrangement, the Cyber Shield programme will extend its protective reach to additional federal agencies. Since launching, Microsoft says the initiative has secured more than 38,000 government accounts and uncovered 35 previously unknown vulnerabilities. Microsoft also signed a Memorandum of Understanding with the government, committing to recently released expectations for data centre operators around clean energy, water use, and local job creation.

Separately, the company pledged to equip three million Australians with workforce-ready AI skills by 2028. New offerings include Microsoft Elevate for Educators, a free programme for teachers and school leaders, and a tie-up with youth platform Anyway to deploy an AI Career Coach in up to 1,000 Australian schools.

Microsoft will also collaborate with the newly formed Australian AI Safety Institute on monitoring and evaluating advanced AI systems, with an initial focus on human-AI interaction risks in companion chatbots and conversational tools.