OpenAI Signs $300 Billion Computing Deal with Oracle

Mexico City, Mexico — OpenAI has signed a landmark contract to purchase $300 billion in computing power from Oracle over the next five years, according to a report from the Wall Street Journal on Wednesday.

The deal, part of Oracle’s ‘Stargate’ initiative, aims to establish large-scale AI data centers in the United States. Expected to generate around $30 billion annually for Oracle, this contract represents one of the largest in the tech industry’s history.

Oracle’s agreement involves a substantial capacity of 4.5 gigawatts of power, equating to the output of more than two Hoover Dams or enough electricity to power roughly four million homes. The company’s stock surged nearly 35% on Wednesday, reflecting the significant market confidence surrounding this development.

In its fiscal quarter ending August 31, Oracle reported adding $317 billion in future contract revenue, with OpenAI being a key contributor. The company is also boosting its data center capacity, with capital expenditures projected to reach nearly $50 billion over the next two years.

The move comes as Oracle seeks to accommodate high-demand clients like OpenAI, further solidifying its position in the competitive cloud computing market.

Chairman Larry Ellison has seen a notable increase in his wealth following the spike in Oracle’s market value due to this significant contract.