Oracle just pulled off the tech equivalent of a mic drop. After markets closed yesterday, its stock shot up thanks to whispers of some expensive contracts, and now we know at least one of the names behind the curtain: OpenAI.
According to the Wall Street Journal, Sam Altman’s AI empire has agreed to shell out a jaw-dropping $300 billion to Oracle for cloud computing. (Via: TechCrunch)
That’s not a typo. Three. Hundred. Billion. Over five years.
But don’t expect the servers to start humming tomorrow, the deal reportedly kicks in come 2027.
If true, it would rank among the largest cloud contracts in history, which is basically the Super Bowl for server farms.
Neither Oracle nor OpenAI is spilling the beans publicly. Oracle offered a classic “no comment,” and OpenAI ghosted requests for confirmation.
Still, this isn’t exactly a surprise. The two companies have been cozy since summer 2024, when OpenAI first started leaning on Oracle’s infrastructure.
Then, in January, OpenAI made it clear it wasn’t going steady with Microsoft anymore, expanding its cloud roster beyond Azure.
That timing lines up neatly with the so-called Stargate Project, an ambitious $500 billion joint plan by OpenAI, Oracle, and SoftBank to build massive, US-based data centers over the next four years.
And OpenAI isn’t just swiping right on Oracle. Earlier this year, Reuters reported the company signed a separate cloud deal with Google, even though Google and OpenAI are basically sprinting neck-and-neck in the AI race.
Apparently, when you’re training AIs that need oceans of GPUs, you don’t play favorites.
So, here we are: Oracle stock soaring, OpenAI spending like there’s no tomorrow, and the cloud wars heating up faster than a rack of GPUs at full blast.
If this all holds true, 2027 is shaping up to be the year Oracle becomes OpenAI’s personal server room, $300 billion at a time.
Does OpenAI’s $300 billion cloud deal with Oracle signal smart diversification away from Microsoft, or is this massive spending unsustainable for an AI company still seeking profitability? Should we be concerned about the consolidation of AI infrastructure among just a few major cloud providers, or does competition between Oracle, Microsoft, and Google benefit innovation? Tell us below in the comments, or reach us via our Twitter or Facebook.
