At Layer 1, Microsoft is building the foundation: the Cloud & Token Factory. The key metric? “Tokens per watt per dollar.”
Global Footprint
- 400+ datacenters
- 70 regions
- +7 new this quarter
- +1 GW capacity added in a single quarter
Custom Silicon
Maia 200
- Launched January 2026
- 10+ petaFLOPS @ FP4
- +30% TCO improvement
- 216GB HBM3e memory
- 3nm process
Cobalt 200
- +50% performance vs Gen 1
- Cloud-native CPU
CapEx Investment
- $37.5B Q2 CapEx (½ GPUs/CPUs, ½ long-lived assets)
- $120B+ FY26 guidance
- $49.3B H1 actual
Efficiency Gains
Throughput improvement: +50% OpenAI inferencing
Multi-Vendor Fleet Strategy
NVIDIA + AMD + Maia
“We don’t want to be locked into any one thing… It’s not a one-generation game. You have to be ahead for all time to come.”
— Satya Nadella
Sovereignty Solutions
| Type | Product | Control |
|---|---|---|
| Public | Azure | Microsoft managed |
| Private | Azure Stack | Customer premises |
| National Partner | Local Control | In-country operation |
The Takeaway
First self-funding AI buildout: $35B+ cash flow → $120B+ CapEx
“Much of the GPUs we’re buying are already contracted for most of their useful life. They’re already sold for the entirety of their useful life. The risk isn’t there.”
— Amy Hood, CFO
This is part of a comprehensive analysis. Read the full analysis on The Business Engineer.









