Microsoft packing bags to move manufacturing out of China

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Donald Trump has been shouting for years that Big Tech should ditch China, and now, it looks like Silicon Valley’s biggest names are actually listening. 

According to a new report from Nikkei Asia, Microsoft has begun preparing to relocate parts of its production out of China, marking the latest twist in the ongoing, complex relationship between US tech companies and Beijing.

Sources say Microsoft has asked suppliers to gear up for “out of China” production of Surface laptops and data center servers, with manufacturing slated to start elsewhere as early as 2026. 

The company has already begun shifting much of its server production this year, and Xbox consoles may be next to get a relocation notice.

Microsoft isn’t the only one eyeing the exit. Amazon Web Services is reportedly exploring moving its AI data center server production out of China, while Google is nudging suppliers to expand capacity in Thailand. 

In other words, the tech giants are quietly packing their factories while pretending it’s “just a logistics thing.”

This corporate game of musical chairs comes as the US–China tech war heats up again. 

Trump has threatened to slap 100% tariffs on Chinese goods, plus expand export controls on critical software. 

For companies with deep roots in Chinese supply chains, and let’s be honest, that’s basically all of Big Tech, that’s a financial earthquake waiting to happen.

China, meanwhile, isn’t just sitting back. It’s tightening control over rare earth minerals, the lifeblood of modern chips, and flexing its regulatory muscles with antitrust probes against companies like Nvidia and Qualcomm. 

The message from Beijing is pretty clear: leaving won’t be painless.

Still, as one Nikkei source put it, “removing Chinese suppliers is very difficult in real practice.” 

This tech decoupling may take years, and nobody’s really sure how clean the break can be. 

But with tariffs looming and tensions rising, the world’s tech giants are realizing they might have to move out of China, whether they’re ready or not.