Microsoft will invest 33.7 billion Swedish crowns ($3.2 billion) to expand its cloud and artificial intelligence (AI) infrastructure in Sweden over a two-year period, it said on Monday.

The rising popularity of generative AI has fueled demand for cloud services, prompting companies, including Microsoft and Amazon Web Services, to invest billions of dollars to build data centers in Europe.

Microsoft invested in data centers in the UK in November and Germany and Spain in February.

"You will see some other announcements, probably more in the fall," Microsoft President Brad Smith said in an interview.

Microsoft plans to deploy 20,000 of the most advanced graphics processing units, which speed up computer calculations, at its Swedish data center sites in Sandviken, Gavle and Staffanstorp.

The company will use Nvidia's faster processors and may turn to semiconductors from AMD and, ultimately, some of its own chips, Smith said.

The race to develop generative AI programs has led to a surge in demand for advanced chips able to support these complex applications.

Microsoft said it was committed to boosting AI adoption across the Nordic region, which, in addition to Sweden, includes Denmark, Finland, Iceland and Norway.

The company plans to train 250,000 Swedes with AI skills within organizations, schools, universities, public sector and society at large over three years.

It is also investing in renewable energy and has procured nearly 1,000 megawatts of renewable energy in Sweden.

Goldman Sachs sees the AI boom as a near-$1 trillion opportunity for the sector as tech companies invest in data centers to train their power-hungry large language models.

"AI is a tech transformation that should be seen as a multiplier or catalyst ... It is part of the strategy going forward when, after successfully fighting inflation, we enter a new phase, an investment phase," said Ulf Kristersson, Prime Minister of Sweden.