Key Takeaways UK-based Nscale has secured a deal with Microsoft to deploy approximately 200,000 Nvidia GB300 GPUs across data centers in the US and Europe, with the Financial Times estimating the cont...
British AI infrastructure startup Nscale has secured one of the largest artificial intelligence infrastructure contracts ever signed, agreeing to supply Microsoft with approximately 200,000 Nvidia GB300 graphics processing units across multiple data centers in the United States and Europe.
While the two companies did not officially disclose financial terms, the Financial Times estimates the deal could be worth up to $14 billion in revenue for Nscale.
The agreement, executed in collaboration with Dell Technologies, represents a major expansion of an existing partnership between the two tech giants and underscores the surging demand for computing power needed to train and operate advanced AI systems.
Under the terms of the deal, Nscale will deliver the bulk of the GPUs to a 240-megawatt hyperscale AI facility in Barstow, Texas, leased from cryptocurrency mining company Ionic Digital.
Approximately 104,000 Nvidia GB300 GPUs will be deployed at the Texas site, with phased delivery scheduled to begin in the third quarter of 2026.
Nscale has ambitious plans to scale the Texas footprint to 1.2 gigawatts over time, and Microsoft holds an option on a second phase of 700 megawatts starting in late 2027.
In Europe, Nscale will deploy around 12,600 Nvidia GB300 GPUs to the Start Campus data center in Sines, Portugal, with installations expected to commence in the first quarter of 2026.
The deal builds upon previously announced projects, including the delivery of approximately 23,000 GPUs to Nscale's Loughton AI campus in the United Kingdom and roughly 52,000 GPUs for a hyperscale facility in Narvik, Norway, through a joint venture with Norwegian investment company Aker.
Nscale's trajectory has been nothing short of remarkable.
The company was spun out from an Australian Bitcoin mining operation just over a year ago and has rapidly transformed into a serious contender among AI hyperscalers.
The startup has raised more than $1.7 billion to date, including a groundbreaking $1.1 billion Series B round in September 2024 that stands as the largest Series B in European history.
That funding round, led by Aker, included participation from technology heavyweights Nvidia, Dell, Nokia, Deutsche Telekom, and asset manager Blue Owl, and valued the company at approximately $3 billion.
Earlier in October, Nscale announced an additional $433 million pre-Series C SAFE financing from many of the same backers, demonstrating continued investor confidence in the company's business model and growth potential.
Josh Payne, founder and CEO of Nscale, emphasized the scale and significance of the Microsoft partnership.
"Nscale is proud to partner with Microsoft on this historic AI infrastructure contract," he said. "This agreement confirms Nscale's place as a partner of choice for the world's most important technology leaders. Few companies are equipped to deliver GPU deployments at this scale, but we have the experience and have built the global pipeline to do so."
Payne added that "the pace with which we have expanded our capacity demonstrates both our readiness and our commitment to efficiency, sustainability, and providing our customers with the most advanced technology available.
It's a clear signal that Nscale is setting a new standard for how the next wave of AI infrastructure will be delivered."
For Microsoft, the deal represents a continuation of its strategy to partner with specialized infrastructure providers to expand computing capacity for AI workloads.
The tech giant has increasingly turned to so-called "neoclouds" like Nscale and CoreWeave to supplement its own data center infrastructure and meet surging demand for AI services across its Azure cloud platform.
Jon Tinter, president of business development and ventures at Microsoft, highlighted the strategic importance of the partnership.
"Together with Nscale, Microsoft is delivering cutting-edge AI infrastructure for our customers," Tinter said.
"Our agreement, announced today, demonstrates our commitment to ensuring that our products are available globally with sustainability and scalability in mind. Nscale is an ideal partner for this mission, given its deep expertise in providing AI infrastructure services at scale."
With momentum building, Payne told the Financial Times that Nscale has public market ambitions and is eyeing an initial public offering toward the end of 2026.
However, the path to IPO will require flawless execution on multiple fronts.
The company has yet to complete a brand-new greenfield facility from scratch, and its success will depend heavily on meeting construction schedules, chip delivery timelines, and power requirements across multiple jurisdictions.
Building large-scale data centers involves navigating complex regulatory approvals, land use permissions, and environmental requirements.
Securing sufficient and sustainable power supplies represents another critical challenge, as AI data centers consume enormous amounts of electricity and clients, regulators, and investors increasingly demand renewable energy sources.
Supply chain logistics also pose risks. Delivering hundreds of thousands of GPUs on schedule depends on Nvidia's production capacity and global shipping conditions, and any delays could affect Nscale's contractual obligations.
Despite these challenges, Nscale has committed between £2 billion and £2.5 billion for data center development in the United Kingdom.
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