OpenAI has entered into a monumental partnership with Oracle, securing a significant agreement to acquire $300 billion in computing capacity over an estimated span of five years, marking one of the largest cloud computing contracts in history, according to a report by the Wall Street Journal.
In July, OpenAI and Oracle announced their collaboration on the Stargate project, which includes the construction of data centers featuring 4.5 gigawatts of power. However, specifics of OpenAI’s financial commitment to the data centers were not disclosed at that time. OpenAI’s contract is scheduled to commence in 2027, as outlined in the report.
OpenAI is projected to generate $12.7 billion in revenue this year and is also believed to be pursuing a separate $10 billion deal with semiconductor giant Broadcom for the development of its own artificial intelligence chip.
During a quarterly earnings call held on Tuesday, Oracle’s CEO Safra Catz disclosed that three unnamed firms had committed to four contracts each valued in the billions during the first quarter. This increasing interest from clients is contributing to an impressive 77 percent surge in Oracle’s cloud infrastructure revenue for the year. Overall, the company reported adding more than $317 billion in future contract revenue during Q1, a substantial figure that has significantly boosted share prices and helped elevate Chairman Larry Ellison to the position of the world’s richest individual.
