Microsoft deals fresh blow to Nscale’s $35bn IPO ambitions

British AI darling Nscale has suffered another setback ahead of its planned $35bn (£26bn) stock market listing after Microsoft walked away from a potential data centre deal worth tens of billions of dollars. The US tech giant has declined an option to more than double the computing capacity it rents from Nscale at a site in Texas, leaving the Nvidia-backed start-up searching for new customers to fill the gap. The decision, first reported by the Financial Times, marks the second time in recent weeks that Microsoft has pulled back from a major Nscale project, raising fresh questions over the company’s ambitious expansion plans as it prepares to float in New York. The London-headquartered firm, which counts former deputy prime minister Nick Clegg and former Meta executive Sheryl Sandberg among its board members, has become one of Britain’s most valuable AI start-ups by securing multibillion-dollar contracts to supply the computing power needed to run artificial intelligence. B