July 24 (Reuters) - Microsoft ( MSFT ) will use Lumen

Technologies' ( LUMN ) network equipment to expand its capacity

for AI workloads, the companies said on Wednesday, as the

technology giant looks to meet growing demand at its data

centers.

Microsoft ( MSFT ) said in April that a shortage of data center

infrastructure needed to deploy AI models was hampering its

ability to capitalize on the boom in the technology.

The company has taken an early lead in the AI race thanks to

its investment in ChatGPT-maker OpenAI and has been pouring

billions of dollars into cloud infrastructure to maintain its

edge over Google-parent Alphabet and Amazon.com ( AMZN )

.

As part of the deal on Wednesday, Lumen will tap the tech

giant's Azure cloud services to cut costs.

The switch to Azure, the companies said, will help improve

Lumen's cash flow by more than $20 million over the next 12

months, aiding the turnaround efforts at the company that

restructured its debt in March.

Lumen, whose shares were 3% higher in early trading, had

$18.59 billion in long-term debt as of March 31, according to

its latest quarterly earnings report.