In a strategic move reflecting the global acceleration toward the adoption of artificial intelligence technologies, Microsoft announced plans for a massive $10 billion investment, scheduled to begin in early 2026, to build a state-of-the-art data center in Portugal. This ambitious project aims to bolster the company's global AI infrastructure and meet the growing demand for high-performance computing.
This massive center will be built near the coastal city of Sines in southern Portugal, a strategically chosen location. The project is a collaboration between Microsoft and two key partners, one British and one Portuguese, reflecting a participatory approach to developing digital infrastructure. Upon completion, the center is slated to house up to 12,600 of NVIDIA's latest AI chips, which are crucial for running large language models and complex AI processes.
Global context and the artificial intelligence race
This investment comes at a time when the world is witnessing a fierce race among tech giants like Microsoft, Google, and Amazon to expand their AI capabilities. Data centers have become the modern factories of the digital economy, providing the immense computing power needed to train and run generative AI models. Microsoft's investments, including its deep partnership with OpenAI, are part of its broader strategy to dominate this vital sector that is reshaping all industries.
Project importance and expected impact
Microsoft President Brad Smith confirmed that Portugal has emerged as a “leading destination in Europe for building AI data centers.” This choice is due to several factors, most notably Portugal’s commitment to renewable energy. The new center will be powered entirely by clean energy, which is crucial given the enormous energy consumption of such facilities. Furthermore, Portugal benefits from its geographic location as a hub for vital undersea cables connecting Europe, the United States, and Latin America, ensuring fast and reliable connectivity to the global network.
Domestically, the project is expected to have a significant economic impact on Portugal, creating thousands of jobs during the construction phase, as well as specialized technical positions once operational, thus enhancing the country's position as a technology hub attractive to foreign investment. Regionally, this investment contributes to the goals of the European Union's "Digital Decade," strengthening its digital sovereignty and its ability to process data within its borders. Daniel Bathurst, product manager at Inscale, a partner in the project, described the demand for AI capabilities as "enormous" in recent months, emphasizing the company's readiness to deliver the project on schedule and highlighting the urgent need for such advanced infrastructure.
