Iran Strikes Data Centres, Targeting Amazon and Other Big‑Tech AI Hubs.

Iran’s drone campaign has turned the Gulf’s nascent AI infrastructure into a battlefield, striking three Amazon‑run data centres in the United Arab Emirates and Bahrain within a single day, according to an internal Amazon status report cited by ABC News. The attacks hit two facilities in the UAE – one on the Abu Dhabi waterfront and another in Bahrain – and a third site in close proximity, all of which host the high‑performance compute clusters that power Amazon Web Services (AWS) cloud offerings across the region. Reuters confirmed that the UAE strike ignited a fire after “objects” hit the site, underscoring the physical damage to the metal‑clad vaults that house thousands of servers (Reuters).

The facilities were not random targets. Iran’s officials have framed the strikes as retaliation against “U.S. war‑effort support” provided by the cloud platforms, which lease capacity to American defense contractors and to the U.S. and Israeli militaries for AI‑driven target identification, as noted by ABC’s coverage of the broader conflict. The drones therefore represent a new phase of Iran’s “asymmetrical warfare” strategy, expanding beyond traditional civilian infrastructure such as oil refineries and desalination plants to include the digital backbone of modern warfare (ABC). By hitting the very hardware that runs AI models for both commercial and defense customers, Tehran aims to raise the cost of U.S. and allied operations in the Persian Gulf.

The strikes come at a moment when the Gulf was being positioned as the next global AI hub. In May 2025, then‑U.S. President Donald Trump announced a $700 billion AI data‑centre project in Abu Dhabi, a joint venture involving OpenAI, NVIDIA, Oracle and Cisco, with the ambition of serving half the world’s population (ABC). A separate $4.2 billion data‑centre deal was signed by Australia’s AirTrunk for Saudi Arabia in October 2025 (ABC). Those announcements spurred a wave of investment and a pipeline of additional facilities from Microsoft, Google and other U.S. firms that rent capacity from locally owned sites. The recent drone attacks now cast doubt on the region’s “political stability and cheap energy” as a reliable foundation for such mega‑scale projects, a concern echoed by Jessie Moritz, senior lecturer in political economy at the Australian National University, who warned that “no country wants to put its data centres in an unstable environment” (ABC).

The immediate economic fallout is already visible. Bloomberg reported that the UAE and Bahrain strikes caused a brief but sharp dip in regional market indices, with a one‑second loss of roughly $1 million in high‑frequency trading linked to the disrupted cloud services (Bloomberg). Oil prices have also risen as shipping lanes in the Strait of Hormuz face heightened risk, further tightening the cost pressures on data‑centre operators that rely on cheap energy to keep servers cool (ABC). In response, U.S. Secretary of War Pete Hegseth has publicly pledged to “make the military AI‑first,” emphasizing that the Pentagon will accelerate experimentation and cut bureaucratic barriers, a stance that signals an expectation that cloud providers will continue to support defense workloads despite the heightened threat environment (ABC).

For the big‑tech firms, the attacks raise a strategic dilemma: whether to double down on Gulf expansion or to relocate critical infrastructure to more secure locales. Amazon’s own internal communications, referenced by ABC, indicate that the company is assessing “contingency plans” for redundancy, including cross‑regional failover to data centres in Europe and the United States. Microsoft and Google, which also lease capacity from the same regional sites, have not disclosed specific response measures, but Reuters notes that the broader U.S.–Israeli war effort is already reshaping global supply chains, with firms scrambling to protect AI workloads from physical disruption (Reuters). As Iran signals that technology infrastructure will remain “in the firing line,” the Gulf’s AI ambitions face a stark test: can the region’s massive capital commitments survive a conflict that now treats silicon as a legitimate target?