Microsoft To Rent Nscale Data Center In Portugal

Microsoft MSFT is expanding its AI infrastructure footprint in Europe, with plans to rent data center capacity in Portugal from hyperscaler Nscale, Bloomberg reported.

The new facility, located south of Lisbon, will be powered by Nvidia's NVDA Blackwell Ultra GPUsabout 12,600 of themand is set to open early next year. Microsoft is ramping up leased capacity to meet surging AI demand across Azure and OpenAI workloads.

Nscale, a U.K.-based cloud provider, recently partnered with Microsoft, Nvidia, and OpenAI to develop 50 megawatts of AI capacity at a campus in Loughton, north of London. The company has quickly become a major player after raising a record $1.1B Series B round in SeptemberEurope's largest everfollowed by a $413M Pre-Series C SAFE backed by Nvidia and Dell DELL.

We're overwhelmed by the interest we've received, said Nscale CEO Josh Payne, calling the back-to-back raises a strong endorsement of its goal to deliver sovereign, scalable infrastructure for the AI era.

Renting capacity allows Microsoft to add scale faster and flexibly without waiting for new data center builds. The deal also tightens its links with Nvidia as both companies race to meet global AI compute demand.

Investors will watch deployment timelines, GPU allocations, and energy partnerships as the Lisbon site comes online in early 2026.