Microsoft has reportedly canceled discussions and in some cases delayed the construction of data centers in Indonesia, Australia and the US. This is due to the demand for data centers to train artificial intelligence (AI) and is likely closely related to the tariff announcement made by President Trump since January.
Demand for data centers has decreased as the process of training new models more efficiently as demonstrated by DeepSeek is now becoming increasingly popular. Importing hardware from abroad will also cause the cost of building data centers to increase sharply.
Taiwan and China, which are major producers of data center components, will be subject to tariffs of 32% and 54% respectively starting April 5 in retaliation for “unfair trade” by both countries according to Trump.
In early January, Microsoft announced that it would invest $80 billion throughout 2025 to build data centers. But the landscape of the technology world has changed since the announcement was made. Since the excessive tariffs were announced yesterday, the shares of all the world's major technology companies have fallen sharply. Apple fell more than 9%, while Amazon and Meta were each almost 9%.