Oracle Powers OpenAI Expansion

Oracle has secured a deal with OpenAI to lease 4.5 GW of data centre power in the US for the 'Stargate' project, aimed at bolstering AI infrastructure. As part of the agreement, Oracle will expand its existing data centre in Abilene, Texas, from 1.2 GW to 2 GW and is considering new data centres in other states.

The 'Stargate' project, a collaboration between OpenAI, Oracle, and SoftBank, anticipates investments reaching $500 billion over four years to establish AI infrastructure within the United States. Oracle is investing $40 billion in Nvidia's high-performance chips to power OpenAI's new data centre. This initiative aims to reduce OpenAI's reliance on Microsoft for data centre capacity, supporting AI model development and operations by 2030.

Oracle's stock has surged following the announcement, reflecting confidence in its strategic expansion and long-term revenue prospects. The company anticipates significant annual revenue from cloud services, with the OpenAI deal contributing to this growth. This collaboration underscores the increasing demand for advanced AI infrastructure and positions Oracle as a key player in the AI landscape.