Microsoft Azure has run out of capacity in both of its UK cloud regions, leaving customers unable to deploy new virtual machines or scale existing workloads, according to users and a report from The Register.
One customer, whose organisation spends millions of pounds a year on Azure, said there was no additional quota available in either UK South or UK West, the only two Azure regions serving the British market.
"So Azure UK is full. Like full full," the user, posting under the handle "Open Sorcerer," told The Register.
The customer said a Microsoft support representative had recommended moving workloads to Sweden, a suggestion described as impractical by organisations subject to UK regulatory and compliance restrictions, particularly in sectors such as healthcare where data sovereignty requirements are strict.
Microsoft did not directly address the capacity complaints, telling The Register that Azure operates through roughly 80 regions worldwide and that it continuously monitors and adjusts how resources are allocated.
The company did not respond to questions about whether its support staff had directed customers towards Sweden or other regions.
The shortage appears to be driven in part by surging demand for AI infrastructure, which requires large quantities of GPUs, memory and storage, pushing data centre capacity requirements significantly higher than traditional cloud workloads.
Forum contributors noted the problem is not confined to the UK, with one commenter writing that Microsoft lacks sufficient compute capacity in the US, EU and Australia as well.
The capacity squeeze has been building for months. Computer Weekly reported earlier this month that Azure was declining new virtual machine requests in UK South, with AMD-powered instances, high-performance computing and GPU-equipped services particularly affected.
Some customers reported being stranded mid-migration, unable to secure enough capacity to complete projects already underway.
Microsoft disclosed in its most recent quarterly earnings call that it had spent $6.7 billion on data centre leasing and activated one gigawatt of new capacity during the quarter, but the investment has not yet eased constraints in the UK.
Related reading
- UK transport department uses Google Cloud AI to cut consultation analysis from months to hours
- AWS chief defends OpenAI investment as routine partner conflict after backing Anthropic
- Anthropic secures multi-gigawatt Google and Broadcom chip deal as annual revenue run rate hits $30bn
Industry data suggests around 121 megawatts of new data centre capacity is due to come online in areas covered by Azure's UK regions during 2026, with sources close to Microsoft indicating the situation may ease by around October.
In the meantime, customers are weighing alternatives including providers such as OVH and Civo, though some have flagged sovereignty risks associated with moving workloads to non-UK jurisdictions.
The recap
- Users report Microsoft Azure UK region has reached capacity.
- Microsoft support allegedly advised moving workloads to Sweden.
- Commenters raised data sovereignty and regulatory compliance concerns.
