Microsoft and NVIDIA Expand AI Partnership with Foundry and Azure AI Innovations
Microsoft is deepening its collaboration with NVIDIA, unveiling significant advancements in its Foundry platform and Azure AI infrastructure at NVIDIA GTC 2026. These innovations aim to streamline the development, deployment, and operation of AI agents and “Physical AI” systems, positioning Azure as a comprehensive end-to-end AI platform.
Microsoft Foundry: The ‘Operating System for AI’
At the heart of Microsoft’s strategy is Microsoft Foundry, now explicitly defined as the “operating system for building, deploying and operating AI at enterprise scale.” Built on Azure, Foundry integrates models, tools, data, and observability into a unified system designed for production-ready AI agents. Recent expansions focus on the Foundry Agent Service and NVIDIA Nemotron models, providing enterprises with a more robust and production-focused AI stack.
The next-generation Foundry Agent Service and its Observability features within Foundry Control Plane are now generally available. This allows teams to develop agents capable of reasoning, planning, and acting across various tools, data, and workflows. Foundry Control Plane offers developers end-to-end visibility into agent behavior, enhancing both productivity, and trust. Corvus Energy is already utilizing Foundry to automate inspection workflows across its global fleet.
Further simplifying the path to production, the Voice Live API is now in public preview, integrating with the Foundry Agent Service to enable the creation of voice-first, multimodal, real-time agentic experiences. Microsoft has too refreshed the Microsoft Foundry portal and expanded integrations with Palo Alto Networks’ Prisma AIRS and Zenity, bolstering builder experiences and runtime security throughout the agent lifecycle.
Expanding Model Support with NVIDIA Nemotron
NVIDIA Nemotron models are now accessible through Microsoft Foundry, adding to the platform’s already extensive selection of models, including the latest reasoning, frontier, and open models. This builds upon a recent partnership bringing Fireworks AI to Microsoft Foundry, enabling customers to fine-tune open-weight models like NVIDIA Nemotron for low-latency performance at the edge.
Scaling AI Infrastructure with Azure and NVIDIA Vera Rubin
Microsoft is optimizing its Azure AI infrastructure for inference-heavy, reasoning-based workloads. The company is the first hyperscale cloud provider to power on NVIDIA’s next-generation Vera Rubin NVL72 systems in its labs, with plans for rollout into liquid-cooled Azure datacenters in the coming months.
Microsoft’s infrastructure innovation extends to sovereign and regulated environments, providing customers with control over both the location and evolution of their AI deployments. Foundry Local now supports modern infrastructure and large AI models, with initial support for the NVIDIA Vera Rubin platform on Azure Local, extending accelerated AI capabilities to customer-controlled environments. This approach maintains Azure-consistent operations, governance, and security through Azure Arc and Foundry Local.
Bringing AI into the Physical World with Physical AI
Microsoft and NVIDIA are collaborating to advance Physical AI, with Microsoft Foundry serving as the platform for hosting and operating Physical AI systems on Azure at cloud scale. Integration with the NVIDIA Physical AI Data Factory Blueprint and Azure services creates a Physical AI Toolchain, enabling developers to build, train, and operate physical AI and robotics workflows.
A public Azure Physical AI Toolchain GitHub repository, integrated with the Nvidia Physical AI Data Factory and core Azure services, is now available. Microsoft and NVIDIA are deepening the integration between Microsoft Fabric and NVIDIA Omniverse libraries, connecting live operational data with physically accurate digital twins and simulations. This allows organizations to move beyond traditional dashboards and alerts to coordinated, AI-driven action across machines, facilities, and workflows.
These combined efforts aim to deliver reliable, production-scale AI by integrating Microsoft’s global AI infrastructure, platforms, and real-world systems with NVIDIA’s latest innovations.