Microsoft to power Japan’s AI future with massive $10B investment

Microsoft has announced plans to invest $10 billion (1.6 trillion yen) in Japan between 2026 and 2029 to boost AI infrastructure and cyber defense capabilities.

The announcement comes during Microsoft’s President Brad Smith visit to Tokyo. In a statement issued by Smith, he also highlighted the tangible alignment between tech company’s strategy and Prime Minister Sanae Takaichi’s goal, aiming to boost the growth through cutting-edge technologies while protecting national security.

Under this investment, Microsoft will also invest in human capital by training around 1 million engineers and developers by 2030.

The training will be materialised by partnering with five other major Japanese IT companies, including NTT Data Corp., NEC, Fujitsu and Hitachi

The tech giant will also collaborate with domestic companies including Sakura Internet and SoftBank to strengthen and expand Japan-based AI computing capacity, such as development of domestic large language models.

The increased domestic computing capacity will allow the Asian country to keep sensitive data within the borders while accessing Microsoft Azure services. Moreover, Japan will also collaborate with other countries on sharing intelligence regarding cyber threats.

According to Smith, Japan is already witnessing a boom in AI adoption and this investment will further push this drive farther. Since 2024, around 1 in 5 working-age people have been using generative tools, compared with the global average of about one in six, according to Microsoft’s AI Diffusion Report.

Soon after the announcement, the shares of Sakura Internet surged as much as 20.2 percent Friday.