Microsoft to invest $1.7 billion in Indonesia for cloud and AI expansion

Microsoft is set to invest $1.7 billion over the next four years to expand its cloud services and artificial intelligence capabilities in Indonesia, CEO Satya Nadella announced during his visit to Jakarta on Tuesday.

This significant investment includes the construction of new data centers as part of Microsoft’s broader strategy to enhance its AI infrastructure in the region.

Nadella’s strategic stops in Southeast Asia

Jakarta marks the first stop on Nadella’s tour across Southeast Asian countries, where he is promoting the U.S. company’s generative AI technology.

Following his engagements in Indonesia, Nadella is scheduled to visit Malaysia and Thailand later in the week.

This trip underscores Microsoft’s commitment to deepening its technological footprint in Southeast Asia.

Microsoft’s discussions with Indonesian leadership

During his visit, Nadella met with outgoing President Joko Widodo and several cabinet ministers to discuss opportunities for joint AI research and talent development.

Communications Minister Budi Arie Setiadi shared that President Widodo proposed that Microsoft consider locating its data centers in Bali or in the new capital city of Nusantara, which is currently under construction in Borneo.

Training and development goals

Furthering its commitment to education and skill development in the region, Microsoft aims to train 2.5 million people in Southeast Asia in AI usage by 2025, with 840,000 of those participants being in Indonesia.

This initiative is part of Microsoft’s global effort to support AI development, which includes a $2.9 billion investment in Japan for cloud and AI infrastructure and a $1.5 billion investment in UAE-based AI firm G42.

Global technology leadership and local impact

Nadella’s visit to Jakarta comes just two weeks after Apple Inc CEO Tim Cook’s meeting with President Widodo, where discussions about a potential manufacturing facility in Indonesia took place.

These high-level engagements highlight Indonesia’s growing importance as a key market for major tech companies, driven by its large, tech-savvy population.

Microsoft Q3 revenues largely fueled by AI adoption

The announcement follows Microsoft’s recent financial successes, with the company surpassing Wall Street estimates for third-quarter revenue and profit, largely fueled by the adoption of artificial intelligence across its cloud services.

This positive financial backdrop supports Microsoft’s aggressive investment strategy in emerging technology markets like Indonesia.