Is Silicon Valley haunted by the Middle East? NVIDIA withdraws, Amazon is attacked, and Microsoft's and Google's $10 billion investments are overshadowed

With the escalation of joint military actions between the U.S. and Israel, the Middle East has become a high-risk battlefield for global tech giants. Amazon's data centers were directly hit by drones, NVIDIA closed its Dubai office, Google employees were stranded locally, and hundreds of billions of dollars in regional AI investment plans have been cast into shadow.

According to Reuters, two data centers operated by Amazon Web Services (AWS) in the UAE were directly attacked by drones, and a facility in Bahrain was also damaged due to nearby explosions. Reuters stated that this is the first known instance of a major U.S. tech company's data center being damaged due to military actions.

This situation has impacted the tech companies' plans in the Middle East: Microsoft plans to invest $15.2 billion in the UAE between 2023 and 2029, Google Cloud and the Saudi Public Investment Fund announced a joint investment of $10 billion to build a global AI hub in Saudi Arabia, and Oracle also plans to invest $1.5 billion to expand its cloud infrastructure in Saudi Arabia.

The attack on the data centers has cast greater uncertainty on the realization of these investment commitments.

Data centers face military strikes for the first time, operations interrupted

According to CNBC, Amazon operates warehousing facilities and data centers in both the UAE and Bahrain, which were directly impacted. Reuters specifically pointed out that the attack on Amazon's data centers marks the first known interruption of operations at a major U.S. tech company's data center due to military actions, which is significant.

Amazon currently has corporate offices across the Middle East, including the UAE, Saudi Arabia, Jordan, Bahrain, Kuwait, Egypt, Turkey, and Israel, and has been continuously expanding its operations in the region in recent years. Following the escalation of the conflict, the company has fully transitioned to a remote work model and has instructed employees to follow local government safety guidelines.

NVIDIA closes Dubai office, Google employees stranded locally

According to CNBC, NVIDIA has temporarily closed its Dubai office, with relevant employees switching to remote work. Notably, NVIDIA has about 6,000 employees in Israel, which is the company's largest R&D base outside the U.S., making it more exposed to geopolitical risks in this round of conflict.

Google has also been affected. According to CNBC, dozens of Google employees were stranded in Dubai after attending a sales meeting, primarily affecting regional employees rather than those from the U.S.

Dubai is a core hub for Google's cloud and sales operations in the Middle East and North Africa, while Tel Aviv is also an important regional operations center for Google. Google had previously announced plans to expand its new headquarters in the ToHa2 building in Tel Aviv, which is expected to become one of Google's largest office locations globally.

Hundreds of billions in AI investment commitments face geopolitical risk scrutiny

The attack on the data centers has led to a reevaluation of the tech giants' large-scale investment plans in the Middle East.

According to Reuters, Microsoft is advancing its total investment of $15.2 billion in the UAE, spanning from 2023 to 2029, relying on its deepening partnership with the sovereign AI company G42 Google Cloud, in collaboration with the Saudi Public Investment Fund, announced that it will invest $10 billion to jointly build and operate a global AI hub in Saudi Arabia with local tech company Humain.

Oracle plans to invest $1.5 billion to expand its cloud infrastructure in Saudi Arabia. Additionally, Oracle and NVIDIA announced a deepening of their cooperation by the end of 2025 to jointly advance a sovereign AI strategy, which includes collaboration with the Abu Dhabi government to develop AI-centric government systems.

The above investment plans were finalized before the regional situation escalated sharply. With ongoing military actions by the U.S. and Israel, whether the Middle East can evolve as expected into a core node of global AI infrastructure has become a key issue that investors need to reassess.

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