3M (NYSE: MMM) and Microsoft (NASDAQ: MSFT) announced a strategic partnership on July 15, 2026, centered on AI data center infrastructure and enterprise software adoption.

Under the agreement, Microsoft's Azure Cloud and AI Infrastructure will deploy 3M's Expanded Beam Optical (EBO) technology in its data centers. Microsoft is described in the press release as the first announced hyperscale cloud provider to use the technology.

EBO technology uses an expanded beam optical interface rather than the direct contact found in traditional connectors. The design is intended to make fiber connections faster to install, more tolerant of contamination, and easier to maintain. Microsoft said early use of the technology showed potential to reduce network deployment timelines in certain environments and demonstrated signal performance under live data center conditions.

3M said it is scaling production of EBO technology to meet demand from hyperscalers and data center operators. The company also said it helped establish the EBO Multi-Source Agreement to support industry standardization of the technology.

"3M's EBO solution will help unlock new levels of performance, reliability and efficiency to ensure customers can run their cloud and AI workloads on a trusted, sustainable and advanced environment," said Cliff Henson, corporate vice president of Cloud Supply Chain at Microsoft.

On the enterprise side, 3M will deploy Microsoft's AI and digital platforms across customer service, finance, sales, and marketing functions. One specific initiative involves Microsoft's Frontier Company deploying engineers to help 3M's Global Business Services team automate customer order management, including credit checks, delinquency assessments, and system updates through an AI agent-driven workflow with human oversight controls.

"Our collaboration with Microsoft supports that vision through targeted optimization opportunities for our enterprise while advancing the infrastructure needed to power the future of AI," said Jon Van Wyck, executive vice president and chief strategy officer at 3M.

The companies said they plan to continue technical collaboration across Microsoft's data center and device ecosystem, focusing on areas including optical connectivity, deployment speed, and scalability.