Nvidia stock edges higher on Microsoft data center expansion report

Nvidia's stock rose slightly in after-hours trading on Thursday, following a Bloomberg report that Microsoft aims to significantly expand its data center capabilities. According to Bloomberg, Microsoft plans to increase its data center network to over 38 gigawatts of capacity by 2032, more than tripling its current 12 gigawatts.

This expansion would surpass the electricity consumption of New York state during peak periods. The reported growth includes both company-owned and leased facilities, but does not factor in computing power rented from cloud providers like Coreweave. While the roadmap could change due to the lengthy development time for server farms and evolving customer preferences, Microsoft's investment in data centers aims to address a computing shortage that has previously limited some AI and cloud business opportunities.

Microsoft's capital expenditures reached $145 billion in its most recent fiscal year, with analysts anticipating continued growth in spending. This potential increase in computing capacity may have implications for chip suppliers, particularly Nvidia, which provides processors for AI and cloud computing workloads.