Microsoft Develops AI Chip to Challenge Nvidia

Published On 13 Oct, 2026
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9 News HD: Microsoft is preparing to expand the use of its own artificial intelligence (AI) chips in a major move to reduce its reliance on Nvidia. The company plans to begin large-scale use of its new Maia 300 chips in 2027 to power AI services across its products.

Microsoft announced Maia 300 as the next generation of its custom AI chip. The company expects the chip to handle more AI work while using electricity more efficiently. This is important as demand for AI tools grows and technology companies face rising costs to run large data centres.

According to Microsoft, Maia 300 is expected to deliver around 40% more AI output per unit of electricity than leading graphics processing unit (GPU) systems. Each server rack will contain 96 chips and will be designed to support demanding AI tasks.

Microsoft has already put its earlier Maia 200 chip into use. It supports services including Microsoft Copilot and can run models from OpenAI, Microsoft's own AI team and other developers.

The company’s move comes as Nvidia remains a major supplier of chips used to power AI systems. Microsoft and other technology firms are developing their own hardware to gain more control over performance, energy use and operating costs.

The Maia 300 chips are expected to be manufactured by Taiwan Semiconductor Manufacturing Company (TSMC). Microsoft plans to expand its AI infrastructure in stages, with larger deployments starting next year.

The new chips could help Microsoft run AI services more efficiently as demand increases. However, their wider impact will depend on how well they perform when used at a much larger scale.