Microsoft has set an internal target to accumulate 1.8 million AI chips by the end of 2024, as per a document seen by Business Insider. The company aims to enhance generative AI in terms of speed, quality, and cost, with a heavy reliance on purchasing GPUs primarily from Nvidia. The document indicates that Microsoft plans to triple its GPU count by 2024, underscoring its commitment to remain at the forefront of generative AI advancements. This endeavor, in partnership with OpenAI, comes with a hefty price tag, with projections suggesting that Microsoft will spend around $100 billion on GPUs and data centers from the current fiscal year until 2027.
Microsoft’s representative, Frank Shaw, refrained from commenting due to the standard quiet period that public companies must observe before releasing earnings reports. Nevertheless, tech giants like Meta are also amassing significant GPU stockpiles, contributing to Nvidia’s soaring valuation, which recently crossed $2 trillion. Meta CEO Mark Zuckerberg revealed plans to purchase 350,000 Nvidia H100 GPUs in 2024, aiming to amass approximately 600,000 GPUs and equivalent chips by year-end. Nvidia’s unveiling of Blackwell, its latest and fastest GPU, coupled with the already powerful H100s currently in the market (with an estimated cost of $30,000) demonstrates the company’s commitment to innovation.
Further insight from a different document obtained by Business Insider highlights Microsoft’s achievement of “record-level GPU capacity” in the latter half of the previous year, although precise figures were omitted. Analysts at DA Davidson estimated that Microsoft spent $4.5 billion on Nvidia chips in the past year. While Microsoft is endeavoring to design its own AI chips to lessen dependence on Nvidia, some within the company remain doubtful due to the substantial gap between the two entities in terms of technological advancement, as progress in this domain unfolds rapidly.
Readers who are Microsoft employees or possess relevant insights are encouraged to reach out to Ashley Stewart via email (astewart@businessinsider.com) or send a secure message from a non-work device via Signal (+1-425-344-8242).