Microsoft Is Investing Big in the UAE. It’s Bringing Nvidia Chips Too.

Microsoft is training U.A.E. government employees in the use of AI across Dubai and other cities. (AFP via Getty Images)

Key Points

• Microsoft plans to invest $15.2 billion in the United Arab Emirates this decade, including $7.9 billion for AI projects over four years.
• The investment includes bringing Nvidia AI chips to the UAE, with US approval for building data centers to train AI models.
• Microsoft’s export licenses allow shipping the equivalent of 60,400 Nvidia A100 chips, using more advanced GB300 GPUs.

Microsoft plans to invest nearly $8 billion in the United Arab Emirates over the next four years, bringing its total investment in the UAE to $15.2 billion this decade, the company said on Monday.

In a post on the Microsoft’s website, President Brad Smith also emphasized the company’s role in exporting U.S. technology to the UAE, including tens of thousands of Nvidia’s artificial-intelligence chips—a breakthrough for the nation’s AI ambitions.

In midmorning trading, Microsoft shares were up 0.5% and Nvidia stock was gaining 2.6%.

Microsoft, Smith said, has received approval from the Trump administration to send chips to the UAE for data centers needed to train AI models.

Over the next four years, Microsoft will invest $7.9 billion on AI projects in the UAE. The company already has spent $7.3 billion from 2023 through this year.

Microsoft’s role in exporting chips suggests the White House is still reluctant to allow unlimited exports of the most advanced AI chips to the Middle East, despite the UAE’s previous pledge to invest $1.4 trillion in the U.S. over 10 years.

The UAE’s planned purchases of up to several hundred thousand Nvidia chips annually in exchange for investment in the U.S. had been delayed by the Commerce Department, The Wall Street Journal reported in October, citing people familiar with the matter. The hang-up was over the potential for Nvidia processors to eventually end up in China.

On Monday, Smith emphasized Microsoft’s role as an effective corporate mediator between the U.S. and UAE.

“Microsoft was one of the few companies during the previous administration to secure export licenses from the Commerce Department to ship GPUs to the UAE,” he wrote. “In no small measure, this is because of the substantial work we did to meet the strong cybersecurity, national security, and other technology conditions required by these licenses.”

The computing capacity Microsoft can export to the UAE is still relatively small. Its licenses will allow it to ship the equivalent of 60,400 additional Nvidia A100 chips, although the actual hardware will be Nvidia’s more advanced GB300 graphics processing units. The A100 has already been superseded by Nvidia’s Hopper generation of chips and its latest Blackwell hardware, with U.S. companies using hundreds of thousands of those processors.

However, Microsoft’s licenses could represent the first step to greater future shipments to a country with the financial and energy resources to invest heavily in AI.

Write to Adam Clark at adam.clark@barrons.com