Microsoft Cuts Fourth Nscale Deal With Texas AI Data Center
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By Mark Bergen
October 15, 2025 at 4:28 AM EDT
Updated on
Takeaways by Bloomberg AIHide
- Nscale has agreed to build a site for Microsoft Corp. in Texas, with a capacity of as much as 240 megawatts of power.
- The site will deploy around 104,000 new Nvidia Corp. chips, the GB300, and is set to open in the third quarter of 2026.
- This is the fourth deal between Nscale and Microsoft in the last two months, following agreements for sites in Norway, Portugal, and the UK.
Nscale, a data center developer focused on artificial intelligence, has agreed to build a site for Microsoft Corp. in Texas, the fourth such deal between the companies in the last two months.
The new site will have capacity of as much as 240 megawatts of power, according to a statement from Nscale on Wednesday.
The British startup said it would deploy around 104,000 new Nvidia Corp. chips, the GB300, in a facility that opens in the third quarter of 2026. It didn’t name the location in Texas.
Formed in 2024, after spinning out of a crypto miner, Nscale has emerged as one of the most active new companies that rent out AI chips, capitalizing on a boom in demand for computing resources. These companies have announced a flurry of new facilities in recent months as part of a massive global build-out to support AI models and services.
That’s come despite a lack of reported profits from the AI industry and the inexperience of many of these infrastructure developers. Nscale, for instance, has yet to build a data center.
Still, Microsoft has been a willing partner. Last month, the software giant agreed to a five-year deal with $6.2 billion with Nscale for a data center in Norway. Nscale said on Wednesday that it plans to deploy about half as many Nvidia GB300 chips in Norway as it will for the new Texas site.
On Tuesday, Microsoft and Nscale announced plans for a new data center in Portugal, which followed a similar agreement for a future site in the UK.
Microsoft has made several such deals with so-called neocloud operators to make up for a shortage of computing capacity for its own server farms.
Josh Payne, Nscale’s Chief Executive Officer, told the Financial Times that the startup was looking to go public as soon as next year. An Nscale spokesperson did not provide further comment.
The planned Texas facility is relatively small compared to other recent projects. OpenAI plans to invest roughly $400 billion to develop five sites for its Stargate AI infrastructure build-out project, which will have a capacity of about 7 gigawatts of power. Microsoft is currently developing a data center in Wisconsin that will deliver at least 900 megawatts of capacity, Bloomberg reported earlier.
Read more: Microsoft Bets $33 Billion on Neoclouds to Ease AI Crunch
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