Microsoft added a GW of data center capacity in the fiscal second quarter, with capital expenditures for the first half of fiscal 2026 totaling $72.4 billion. The expansion is visible in how these data centers are being built and deployed. Facilities are increasingly optimized for GPU-heavy workloads, with interconnected systems designed to improve throughput and reduce latency. The buildout has continued into the third quarter, MSFT planning to acquire approximately 3,200 acres in Cheyenne, WY, for a new facility and separately agreeing to rent 30,000 additional Nvidia Vera Rubin chips from Nscale at a campus in Narvik, Norway, building on a prior $6.2 billion commitment at the same site. These moves reflect a footprint strategy that is both geographically diversified and forward planned, addressing scale requirements while also aligning with data sovereignty needs. Azure grew 39% year over year in the previous quarter, yet demand continued to outpace supply across regions and customer segments.<\/p>\n
The Zacks Consensus Estimate for the fiscal third quarter Intelligent Cloud revenues is pegged at $34.2 billion, implying 28.1% year-over-year growth. As AI workloads continue to reshape infrastructure requirements, Microsoft\u2019s expanding data center footprint is expected to remain a key catalyst for effectively converting constrained demand into revenue-generating capacity.<\/p>\n
How Amazon and Alphabet Are Approaching the Same Race<\/p>\n
Amazon (AMZN Quick QuoteAMZN<\/a> – Free Report<\/a>) and Alphabet (GOOGL Quick QuoteGOOGL<\/a> – Free Report<\/a>) are expanding data center infrastructure at a pace that mirrors Microsoft’s buildout urgency, each responding to AI workload demand that continues to outpace available supply. Amazon has committed $200 billion in capital expenditures for 2026, predominantly toward AWS data center capacity, adding nearly four gigawatts of capacity over the past year. Alphabet expects 2026 capital expenditures to be between $175 billion and $185 billion, with Google Cloud redesigning its data center network around GPU-heavy workloads and proprietary TPU infrastructure.\u00a0<\/p>\n Like Microsoft, both Amazon and Alphabet have flagged persistent supply constraints while expanding geographically to meet sovereignty-driven demand. Against this backdrop, Microsoft\u2019s data center footprint reflects more immediate capacity pressure, with demand already exceeding available supply and expansion focused on closing that gap.<\/p>\n MSFT\u2019s Share Price Performance, Valuation & Estimates<\/p>\n MSFT shares have increased 14.2% in the year-to-date period, while the Zacks Computer \u2013 Software<\/a> industry has returned 12.9% and the Zacks Computer and Technology <\/a>sector has appreciated 15.2%.<\/p>\n MSFT\u2019s YTD Price Performance<\/p>\n From a valuation standpoint, MSFT stock is currently trading at a forward 12-month Price\/Sales ratio of 8.59X compared with the industry\u2019s 7.16X. MSFT has a Value Score<\/a> of D.<\/p>\n MSFT\u2019s Valuation<\/p>\n The Zacks Consensus Estimate for MSFT\u2019s fiscal 2026 earnings is pegged at $17.10 per share. The estimate indicates 25.37% year-over-year growth.<\/p>\n![\"Zacks](\"https:\/\/www.europesays.com\/ai\/wp-content\/uploads\/2026\/04\/157000.jpg\"\/)
Image Source: Zacks Investment Research<\/p>\n![\"Zacks](\"https:\/\/www.europesays.com\/ai\/wp-content\/uploads\/2026\/04\/156999.jpg\"\/)
Image Source: Zacks Investment Research<\/p>\n