OpenAI signs record $300 billion deal with Oracle to advance AI

OpenAI has signed a five-year contract with Oracle to purchase cloud computing capacity.

The deal is valued at $300 billion — one of the largest contracts in cloud computing history and several times greater than OpenAI’s current revenue.

According to analysts, operating the future data center built on Oracle’s infrastructure will require around 4.5 gigawatts of power, comparable to the consumption of 4 million households. The contract is set to take effect in 2027, and experts already call it risky for both OpenAI and Oracle. At present, OpenAI’s annual revenue is roughly $10 billion — far below the size of the annual payments required under the agreement.

The news sent shockwaves through the market: Oracle shares jumped 43.1% on September 10, pushing the company’s market capitalization to $968.8 billion and placing it among the top 10 companies in the S&P 500 index.