Microsoft and Abu Dhabi-based G42 have announced plans to expand data centre capacity in the United Arab Emirates by 200 megawatts, marking a significant step in Microsoft’s $15bn investment programme in the Gulf.

The expansion, to be delivered through G42’s subsidiary Khazna Data Centers, is expected to begin operations before the end of 2026. The new infrastructure will strengthen Microsoft Azure’s sovereign and scalable cloud services across the region, according to a joint statement released on Wednesday.

Microsoft’s total investment in the UAE will reach $7.3bn by the end of this year, with an additional $7.9bn planned for 2026–2029. The project comes as the UAE accelerates its strategy to become a global hub for artificial intelligence and advanced technology.

The announcement follows Washington’s approval for the export of advanced Nvidia AI chips to Microsoft’s UAE facilities. These chips will power the company’s next generation of AI-driven data centre operations in the region.

Microsoft took a $1.5bn minority stake in G42 last year. The Abu Dhabi-based firm is backed by Silver Lake, Mubadala Investment Company, and the family office of Ray Dalio.

The new data centre capacity expansion builds on Microsoft’s partnership with G42 to deepen AI and cloud infrastructure in the Gulf, supporting both commercial and government clients across sectors.

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