Oracle is heavily investing in data centres to meet the growing demands of AI companies like OpenAI. This commitment involves billions in capital expenditure to provide substantial computing power. Oracle's cloud infrastructure revenue is expected to grow significantly, driven by AI.
The company's strategy includes a global construction programme, with investments in Japan, Malaysia, Germany and the Netherlands. These investments address data sovereignty laws, ensuring data storage and processing within national borders. Oracle is also collaborating with OpenAI on the Stargate initiative, a $500 billion project to build large-scale data centres across the US.
However, Oracle's reliance on OpenAI and debt-funded data centre expansion has raised concerns among investors. Despite these concerns, Oracle expects cloud infrastructure revenue to continue growing, driven by strong demand for its AI infrastructure.
