Nscale Acquires Major US Data Centre, Signs AI Compute Deal With Microsoft

Nscale, a UK artificial intelligence infrastructure startup, has acquired one of the largest AI data centre sites in the United States and agreed to a substantial computing deal with Microsoft. Backed by Nvidia, Nscale continues its rapid expansion after emerging from stealth in 2024.

The acquisition involves the purchase of American Intelligence & Power Corporation, which owns the Monarch Compute Campus in West Virginia. The site, spanning 2,250 acres, is expected to be capable of delivering two gigawatts of power by early 2028, with plans to expand to eight gigawatts by 2031. Data centres at this scale are critical to meeting the growing demand for AI model training and inference, which require powerful hardware such as specialized graphics processing units (GPUs).

Josh Payne, CEO of Nscale, described the move as a strategic effort to serve the world's largest AI infrastructure market. "AI infrastructure needs to be built where demand is, and right now a significant share of that demand is in the United States. Monarch allows us to meet that demand," Payne said. The acquisition is set to build on Nscale’s operational footprint in the US and accelerate its ability to scale services for customers globally.

Competition for the site was strong. According to The Information, major technology firms including Amazon and Meta also expressed interest in acquiring the campus, which is expected to require several billion dollars in financing to develop fully. While financial details were not disclosed, reports indicate that acquiring the data centre could triple Nscale’s near-term revenue projections.

Nscale recently raised $2 billion in capital and, as part of the West Virginia arrangement, has finalized a contract with Microsoft to rent 1.35 gigawatts of server capacity at the new campus. The servers will be equipped with Nvidia’s Vera Rubin chips, specialized hardware that enhances processing speed and efficiency for machine learning tasks. The agreement, set to begin in 2027, underscores the growing partnership between Nscale and Microsoft.

Last year, Nscale secured a contract with Microsoft valued at up to $14 billion to construct AI data centres in Texas. In addition to its US operations, Nscale has announced plans for facilities in both the UK and Norway. The company is also providing infrastructure for OpenAI's Stargate data centres in Norway and the UK, which are central to the deployment and operation of large-scale AI systems.

The continuing buildout of high-capacity data centres reflects the escalating requirements for computational resources driven by advancements in AI, particularly as businesses and institutions adopt increasingly sophisticated generative models and automation technologies.

tech.eu