Microsoft Corp has struck a multi-year deal worth nearly $20 billion to acquire artificial intelligence cloud computing capabilities from Nebius Group NV. The latter is a technology company spun off from Russian internet giant Yandex. Nebius said in a disclosure to the U.S. Securities and Exchange Commission on Monday that the agreement runs through 2031 and is worth between $17.4 billion and $19.4 billion. The company's investors include Nvidia and Accel Partners, among others.
The agreement is huge business for Nebius, which has been trying to capitalize on the artificial intelligence boom by expanding its data center business. At the same time, Microsoft is looking to address an ongoing shortage of AI cloud computing capabilities.
Faced with growing demand for AI services, Microsoft has boosted capital expenditures to record levels in the past few years. The Redmond, Wash.-based company focuses on building new data centers and outfitting them with expensive servers and network equipment.