Microsoft Withdraws from Nscale's UK Data Center Project, Threatening $35 Billion IPO

Microsoft has pulled the plug on its planned anchor investment in Nscale's flagship UK data center in Essex, striking a significant blow to the startup's $35 billion IPO ambitions just weeks before the company's scheduled Wall Street listing. The tech giant was set to become the primary tenant at Nscale's Loughton facility, renting 23,000 Nvidia GB300 GPUs—scheduled for Q1 2027 delivery—to anchor the 50-megawatt AI infrastructure hub. However, UK Power Networks informed Nscale that the site may not receive grid connection until the early-to-mid 2030s, rendering the project unviable on Microsoft's timeline. Microsoft's withdrawal follows months of mounting pressure on the data center startup, which has already faced significant setbacks at its flagship Arctic facility in Norway, where its 30-megawatt Glomfjord data center is six months behind schedule due to cooling system leaks, a transformer fire, and local regulatory hurdles.