Oracle and OpenAI drive record $300B investment in cloud for AI
The software company Oracle will provide OpenAI with vast computing power under a $300B contract, fuelling Project Stargate as both firms gamble on the AI race.
OpenAI has finalised a record $300 billion deal with Oracle to secure vast computing infrastructure over five years, marking one of the most significant cloud contracts in history. The agreement is part of Project Stargate, OpenAI’s plan to build massive data centre capacity in the US and abroad.
The two companies will develop 4.5 gigawatts of computing power, equivalent to the energy consumed by millions of homes.
Backed by SoftBank and other partners, the Stargate initiative aims to surpass $500 billion in investment, with construction already underway in Texas. Additional plans include a large-scale data centre project in the United Arab Emirates, supported by Emirati firm G42.
The scale of the deal highlights the fierce race among tech giants to dominate AI infrastructure. Amazon, Microsoft, Google and Meta are also pledging hundreds of billions of dollars towards data centres, while OpenAI faces mounting financial pressure.
The company currently generates around $10 billion in revenue but is expected to spend far more than that annually to support its expansion.
Oracle is betting heavily on OpenAI as a future growth driver, although the risk is high given OpenAI’s lack of profitability and Oracle’s growing debt burden.
A gamble that rests on the assumption that ChatGPT and related AI technologies will continue to grow at an unprecedented pace, despite intense competition from Google, Anthropic and others.
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