- The Telegraph reported on October 18, 2026, that Microsoft had ended its agreement to anchor Nscale's Loughton, Essex data center. Grid officials reportedly told Nscale not to expect power until the 2030s. Microsoft confirmed on October 19 that the decision 'relates to a single site.'
- Loughton was announced in September 2025 as a 50 MW site, expandable to 90 MW, for about 23,000 Nvidia GB300 GPUs from Q1 2027. That's about 12% of the approximately 200,000 GPUs Nscale contracted to Microsoft in October 2025.
- Nscale says it remains committed to Loughton and is looking at alternative power. It filed for a NYSE IPO in September 2026; TechCrunch reported that Microsoft and Anthropic deals make up about 85% of its more than $103 billion backlog.
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Microsoft has ended its agreement to anchor Nscale's planned AI data center in Loughton, Essex, northeast of London. The Telegraph first reported the move on Sunday, October 18, 2026, and Reuters and Bloomberg followed. Grid officials had reportedly told Nscale they didn't expect to supply power to the site until the 2030s. On Monday, October 19, a Microsoft spokesperson said "this decision relates to a single site" and that Microsoft remains "committed to our partnership with Nscale." Nscale says it will still build. It's the latest sign that grid power, not chips, is setting the pace for AI datacenters in Britain.
This story is based on Reuters, AFP, The Register, The Next Web, TechCrunch and the Evening Standard, and on Nscale's and Microsoft's own 2025 announcements, checked October 20, 2026. The BBC's report couldn't be read, and the Telegraph's original is paywalled; its account appears here as relayed by Reuters and TNW. It isn't investment advice. For the market backdrop, including an earlier Bloomberg headline on Nscale's IPO, see our story on the October AI sell-off.
The short version
- What: Microsoft terminated its agreement to anchor Nscale's Loughton site, per the Telegraph via Reuters. Microsoft confirmed the decision on October 19.
- Why (reported): power. The Telegraph reported, and The Guardian in September, that grid officials pointed to the 2030s for a connection. Microsoft hasn't given a reason beyond calling it a single-site decision.
- Nscale's position: still committed to Loughton and the UK, exploring alternative power, and saying the grid issue "has no impact on our other contracts."
- IPO: Nscale filed for a New York Stock Exchange listing in September 2026.
What was planned at Loughton?
Nscale announced the site on September 16, 2025, which Microsoft described as the eve of President Trump's state visit to the UK. Its release described an AI campus in Loughton that would start with 23,040 Nvidia GB300 GPUs in a 50 MW facility, scalable to 90 MW, with GPUs to be delivered in Q1 2027 to run Microsoft Azure services in the UK. Microsoft's Brad Smith said the same day that Microsoft would build "the country's largest supercomputer," with more than 23,000 Nvidia GPUs, in partnership with Nscale. It was part of a $30 billion Microsoft investment in the UK from 2025 to 2028, half of it capital spending.
| Item | Value | Source |
|---|---|---|
| Site | Loughton, Essex | Nscale, September 16, 2025 |
| GPUs (initial) | 23,040 Nvidia GB300 | Nscale, September 16, 2025 |
| Power | 50 MW initially, scalable to 90 MW | Nscale, September 16 and October 15, 2025 |
| GPU delivery | Q1 2027 | Nscale, September 16, 2025 |
| Customer | Microsoft (Azure services in the UK) | Nscale; Microsoft, September 16, 2025 |
| Reported build cost | £2 billion | Evening Standard, October 19, 2026 |
| Reported power date | 2030s | Telegraph via Reuters, October 18, 2026 |
Table 1The site's specifications come from Nscale's and Microsoft's 2025 announcements; the build cost and the power date are later reporting. Sources: as listed in each row.
Last verified: October 20, 2026
Why did Microsoft pull out?
Microsoft hasn't said, beyond the single-site statement. The reported reason is the grid. The Register, citing The Guardian, wrote that UK Power Networks warned Nscale in September that the capacity it needed might not arrive until the 2030s. UK Power Networks told AFP and The Register that it can't discuss individual connections, but that "many data centers" are waiting on works to the national transmission network, which it doesn't own. Nscale has called it a "London-wide grid issue."
Loughton, from announcement to Microsoft's exit
- Sep 16, 2025Nscale announces Loughton: 23,040 Nvidia GB300 GPUs in a 50 MW facility, scalable to 90 MW, for MicrosoftConfirmed
- Oct 15, 2025Nscale contracts about 200,000 Nvidia GB300 GPUs to Microsoft across four countriesConfirmed
- Sep 2026UK Power Networks warns the capacity might not arrive until the 2030s (The Guardian, via The Register)Reported
- Sep 2026Nscale files for a New York Stock Exchange listing (TechCrunch)Reported
- Oct 18, 2026Microsoft ends its agreement to anchor Loughton (Telegraph, via Reuters)Reported
- Oct 19, 2026Microsoft: "this decision relates to a single site"Confirmed
- Q1 2027Original GPU delivery date for Loughton (Nscale, 2025)
- 2030sWhen grid officials reportedly expect to supply power to the site (Telegraph, via Reuters)Reported
- Confirmed
- Reported
The Register also reported that the site was still a scaffolding yard in March and that Nscale has since cleared the land. It added that Nscale now has no publicly announced customer for Loughton.
How much of the Microsoft–Nscale deal does this touch?
Not most of it. On October 15, 2025, Nscale announced a contract to deliver about 200,000 Nvidia GB300 GPUs to Microsoft across four countries:
| Site | GPUs (approx.) | Timing (per Nscale, 2025) |
|---|---|---|
| Texas (leased from Ionic Digital; ~240 MW) | 104,000 | Phased delivery from Q3 2026 |
| Narvik, Norway (Aker–Nscale joint venture) | 52,000 | Not stated |
| Loughton, UK (50 MW, to 90 MW) | 23,000 | From Q1 2027 |
| Sines, Portugal (Start Campus) | 12,600 | From Q1 2026 |
Table 2Loughton's 23,000 GPUs were the third-largest of the four sites in the roughly 200,000-GPU contract; Texas alone accounts for 104,000. Source: Nscale, 2025.
Last verified: October 20, 2026
On those figures, Loughton was about 12% of the GPUs. A person familiar with the matter told AFP it was a small part of Microsoft's agreements with Nscale. Nscale says its other contracts are unaffected, and Microsoft says the partnership continues.
What does it mean for Nscale's IPO?
Nscale filed for a NYSE listing in September 2026. TechCrunch reported on September 22 that the filing shows more than $103 billion in contracts, about 85% of it from two deals: $43.8 billion of compute for Microsoft through 2033 and a $44.6 billion agreement with Anthropic. TechCrunch also reported that Nscale was expected to seek a $35 billion valuation (citing the FT) and raise $3 billion (citing Bloomberg), and that it lost $1.02 billion in the first half of 2026 on $140.6 million of revenue. Anthropic can cancel its deal if Nscale misses what the filing calls "stringent" milestones, according to TechCrunch.
On October 15, a Bloomberg feature said Nscale's IPO plans had been "muddied" by datacenter delays. On October 18, Bloomberg reported, as relayed by PYMNTS, that Nscale hadn't yet started formal marketing of the offering while it answers SEC comments, and that some backers were pushing for a valuation of $16 billion to $19 billion instead of the roughly $30 billion goal. No IPO postponement has been announced. Loughton was a UK flagship rather than a large share of the backlog, but it's a public example of the delivery risk investors are weighing.
The UK backdrop
Loughton isn't the first setback for big UK AI compute plans. In April 2026, OpenAI paused Stargate UK, its project with Nscale and Nvidia, saying it would move ahead "when the right conditions such as regulation and the cost of energy" allow, Data Centre Review reported. That project was expected to include Cobalt Park, part of the North East AI Growth Zone. Loughton itself hasn't been reported as being in an AI Growth Zone. AFP noted that Keir Starmer had called the Loughton site the "largest U.K. sovereign AI data center." No UK government statement on Microsoft's exit has been reported. The government's October 12 AI security plans are covered in our story on Kanishka Narayan's speech. For how other gigawatt projects are progressing, see our datacenter tracker.
What's confirmed, reported and uncertain
- Confirmed: Microsoft's single-site statement and continued partnership (Microsoft spokesperson, quoted by AFP and the Evening Standard); Nscale's statements (to Reuters, The Register and the Telegraph); the original Loughton and Microsoft contract specifications (Nscale and Microsoft, 2025).
- Reported: that Microsoft terminated the agreement and that power is expected in the 2030s (Telegraph via Reuters; The Guardian via The Register); IPO terms and backlog (TechCrunch, citing the filing, the FT and Bloomberg); the stalled marketing and investor valuation pushback (Bloomberg via PYMNTS, October 18).
- Uncertain: Microsoft's exact reason, whether Nscale finds alternative power or a new tenant, whether any penalties apply, and whether the IPO timetable changes.
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