Microsoft (MSFT) has set its sights on India as its next frontier for artificial intelligence growth opportunities. The tech giant plans to invest $3 billion in the country’s AI and cloud infrastructure. The investment will also include the development of data centres that are key to supporting AI models. The company also plans to train 10 million people in AI as part of the investment.
Microsoft $3 Billion AI Bet
The two-year investment will also be used to upskill tech gurus in India with vital artificial intelligence skills. The investment also allows Microsoft to take advantage of the country’s vast tech expertise and low cost, which helps make the investment profitable. Currently, Microsoft employs close to 20,000 people across 10 cities. Consequently, it has succeeded in tapping the country’s vast talent base.
The $3 billion investment underscores how India is increasingly becoming an essential piece of the puzzle amid the AI race. It has emerged as a key growth market for US tech giants owing to its vast population, which is an ideal target market for various products and services. Recently, CEOs of some of the biggest tech companies, including Nvidia (NVDA) and Advanced Micro Devices, have visited the country and promised big investments.
AI Investments
Microsoft is one of the companies that are on an investment spree as it looks to come up with crucial AI tools and features that can strengthen its vast product and service lineup. It has already affirmed plans to invest about $80 billion in 2025, dedicated to developing data centres that train AI models and deploy cloud-based applications.
Since OpenAI introduced ChatGPT in 2022, investments in AI have increased as businesses from a variety of industries look to incorporate AI into their goods and services. Due to AI’s high processing demands, there is a growing need for specialized data centres that allow tech companies to connect thousands of chips in clusters. Microsoft has been spending billions to expand its network of data centres and improve its AI infrastructure.
Anthropic $16 Billion Round
In the meantime, artificial intelligence startup Anthropic is negotiating a new round of funding that could increase the company’s valuation from roughly $16 billion less than a year ago to $60 billion. Tech behemoths like Amazon (AMZN), Google, and Salesforce (CRM) have contributed more than $11.3 billion to Anthropic since its founding in 2021.
The new funding round underscores institutional investors’ growing demand for AI startups. In a deal last month, Elon Musk’s xAI raised $6 billion, valuing the business between $35 billion and $45 billion. The creator of the online chatbot ChatGPT, OpenAI, raised $6.6 billion in October at a valuation of $157 billion.
Nvidia Soaring Value
Separately, Nvidia has affirmed its status as the most valuable company and a leader among chip companies in the world. Its market cap is now more than that of its leading competitors, Intel, Advanced Micro Devices and Broadcom combined. Its market cap has more than doubled over the past year and shows no signs of slowing down.
Nvidia’s rise to stardom stems from the growing demand for its graphics processing unit to power and support AI models. The strong demand has led to record-breaking revenues and profits, consequently strengthening the stock’s sentiments in the market. The introduction of Blackwell architecture as Hopper’s successor is poised to enhance the company’s edge in the market.
