After Microsoft, AWS Halts Data Centre Expansion Plans
Microsoft recently scrapped data center projects totaling 2 gigawatts across the U.S. and Europe, citing supply-demand imbalances
Amazon Web Services (AWS), the cloud division of Amazon, has reportedly paused some data center lease discussions, particularly in international markets, according to a Wells Fargo analyst.
The analysts noted that while Amazon hasn't canceled any deals, it's reassessing recent aggressive leasing activity, mirroring a similar pullback by Microsoft.
This cautious approach reflects a broader trend among hyperscalers—major cloud providers like Meta, Google, and Oracle—who are becoming more selective in pre-leasing capacity expected to go live by 2026.
Microsoft recently scrapped data center projects totaling 2 gigawatts across the U.S. and Europe, citing supply-demand imbalances.
Delayed returns on massive AI investments, coupled with economic uncertainty, could potentially be influencing spending behavior, especially amid the high costs of AI infrastructure, such as NVIDIA chips.
Investor concerns are also growing due to slow AI monetisation and competition from cost-effective alternatives like Chinese startup DeepSeek.
Nonetheless, both AWS and Microsoft remain deeply committed to AI investments, backing leading startups Anthropic and OpenAI, respectively.
The developments come at a time when US President Donald Trump announced Project Stargate- $500 billion initiative aimed at creating an AI infrastructure in the US over the next four years.
