Microsoft Expects To Spend $80 Billion on AI-Enabled Data Centers in Fiscal 2025 16
Microsoft plans to spend $80 billion in fiscal 2025 on the construction of data centers that can handle AI workloads, the company said in a Friday blog post. From a report: Over half of the expected AI infrastructure spending will take place in the U.S., Microsoft Vice Chair and President Brad Smith wrote. Microsoft's 2025 fiscal year ends in June.
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$80 billion to a $3+ trillion company is just a good write off.
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$80 billion to a $3+ trillion company is just a good write off.
You confuse stock valuation with revenue. Regardless, MS can afford the expense but will it ever pay back in massive revenue increases? Unlikely..
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My prediction is that they will be too late. The claims about what LLMs can do have gotten more desperate and deranged in the last few months. I think the hype has maybe half a year left, maybe less.
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They've had almost 30 years to improve Windows. How much longer would you like to give them?
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"Improving" Windows and Office has gotten us longer "engagement" times the last few years, i.e. everything gets slower. By that deranged metrics it is a good thing is MS products waste more of your time, even if you get less done in that time or even overall.
If they invest more money into "improving" Windows, that effect will likely get worse.
Re: But isn't AI an bubble? (Score:2)
It probably is a bubble. But that doesn't mean that the hardware won't be useful regardless. The hardware is certainly liquidcooled data enters packed of fancy blackwells GPUs. And probably some of the custom inference ASIC MS is building.
Even if AI dies tomorrow, the hardware is easilly reused as part of Azure.
Re: But isn't AI an bubble? (Score:2)
Re: But isn't AI an bubble? (Score:2)
That is also true. Being massively over hyped and over valued is what makes a bubble. That does not mean there is not a valuable product that will come out of it.
The two things can be true at the same time. There was a massive housing bubble. We still live in houses and apartments.
MS should pay for the energy infrastructure (Score:2)
$80 Billion on a crap shoot with the tax and rate payers footing the bill for the energy infrastructure costs. Nice move, MS. Next you'll be forcing all your sheep to use it whether they like it or not.
Lots to consider (Score:2)
First, spending $80 billion in capital expenditures for a business isn't the same as for an individual. That money gets figured in as depreciation and ultimately as a tax deduction. Microsoft's 2023 tax rate was 18.3%, so that's a huge tax deduction (spread over many years, but it's still billions per year).
Second, Microsoft's annual profit is around $110 billion, and its cash on hand is close to $80 billion.
Third, Microsoft's board recently authorized $60 billion in stock buybacks. Investing $80 billion
But what about Climate Change? (Score:2)
So we're expanding AI, which gobbles up massive amounts of electricity, which is still mostly generated by burning fossil fuels. I guess if we're all out of a job, our carbon foot print should shrink at the individual level rather rapidly. Maybe that's the plan!