OpenAI and Oracle Cloud Deal: A Historic Partnership

Oracle's Stock Surge Fueled by Major Contracts

Following yesterday’s market close, Oracle experienced a significant increase in its share price. This rise was triggered by the announcement of several substantial, multi-billion-dollar contracts secured with various clients.

Initial reports indicated these were significant deals, and now more details are emerging regarding the potential recipients of Oracle’s cloud services.

OpenAI Commits to $300 Billion in Compute Power

According to reports from the Wall Street Journal, Oracle has entered into an agreement with OpenAI. The AI research and deployment company will procure $300 billion worth of compute capacity from Oracle over approximately five years.

Purchasing of this compute power is scheduled to commence in 2027.

A Landmark Cloud Computing Agreement

Should the Wall Street Journal’s information prove accurate, this agreement would represent one of the most significant cloud contracts ever finalized.

Oracle has not issued a statement commenting on the report. OpenAI did not respond to inquiries seeking confirmation or further details.

Expanding Partnerships and Diversifying Cloud Providers

Oracle and OpenAI have already established a working relationship. OpenAI began utilizing Oracle’s compute resources during the summer of 2024.

Furthermore, in January, the AI company began to reduce its reliance on Microsoft Azure as its sole cloud provider.

The Stargate Project and Infrastructure Investment

This shift away from exclusive dependence on Microsoft coincided with OpenAI’s participation in the Stargate Project. This initiative involves a combined investment of $500 billion from OpenAI, SoftBank, and Oracle into domestic data center infrastructure over the next four years.

Strategic Sourcing: OpenAI's Deal with Google

The demand for computational resources at OpenAI is demonstrably high. Reuters reported this spring that the company also secured a cloud computing agreement with Google.

This move is notable given the competitive landscape, as OpenAI and Google are currently engaged in a race to achieve dominance in the field of artificial intelligence.