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Microsoft reportedly withdrew from a deal to lease computing capacity at AI infrastructure player Nscale’s planned data centre in the UK due to delays related to power supply, adding to mounting concerns around the status of the country’s AI projects.
According to The Telegraph, the US technology giant pulled the plug on the mooted data centre to be constructed in Loughton, Essex, which was originally expected to receive a grid connection by the end of 2026.
However, it now faces a wait until the following decade for supply.
“Our relationship with Microsoft remains strong and long-term, and this unfortunate London-wide grid issue has no impact on our other contracts,” an Nscale spokesperson told Reuters. The pair are still collaborating across other projects, including developments in Norway, Portugal and the US.
The company reportedly added it remained “committed to both the Loughton project and the UK” and was exploring alternative power sources.
Announced last year, the Loughton development was backed by a £2.5 billion investment commitment from Nscale and formed part of a wider UK push to attract AI infrastructure spending. Microsoft had planned to lease the site’s entire 50MW capacity and deploy an AI supercomputer equipped with around 23,000 Nvidia GB300 chips.
The setback revives questions about the delivery of the UK’s headline AI investment pledges. A Guardian investigation in March raised concerns over the status of major announced projects, including the Loughton site, which was still being used as a scaffolding yard when visited by reporters in February. Nscale subsequently said it had purchased the site in September 2025 and was targeting delivery in 2027.
Power availability remains a wider constraint for UK data centre development, as growing demand from AI workloads puts pressure on grid infrastructure.
Nscale, which is backed by Nvidia, filed for a US IPO last month and raised $3.4 billion in pre-IPO financing. The UK-based company named Microsoft and Anthropic as expected major customers in its prospectus.
The post Microsoft pulls out of Nscale UK data centre deal appeared first on Mobile World Live.
Microsoft took the wraps off the third-generation of its in-house AI chip, as part of a plan to reduce its reliance on buying processors from Nvidia.
The Maia 300 chip will be used for the tech giant’s multi-gigawatt deployments in 2027, making it the primary inference system for Microsoft products and services. Reuters reported it plans to potentially deploy more than 1 million of the chips next year.
According to a blog post from EVP Scott Guthrie, the company expects Maia 300 to deliver 40% more tokens per megawatt compared to leading GPU-based systems without naming Nvidia.
The Maia 300 is built as a single system, with software, silicon, physical rack infrastructure, networking, and data centres co-designed to operate as a single platform.
Guthrie noted a 96-chip rack offers seven times the rack-scale token throughput of Microsoft’s Maia 200. He said the new chip is “designed with an inference-first architecture optimized for long-context, memory-intensive and decode-heavy AI workloads”.
The Maia 200 chip powers the company’s production workloads, including Microsoft 365 Copilot, as well as OpenAI models running on Microsoft’s Azure cloud computing service.
The post Microsoft unveils Maia 300 custom AI chip appeared first on Mobile World Live.
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