TLDR: OpenAI has secured a monumental $30 billion annual cloud services agreement with Oracle, set to significantly expand its AI infrastructure and power its ambitious ‘Stargate’ project. This deal, one of the largest in the AI sector, will provide OpenAI with 4.5 gigawatts of data center capacity, bolstering its computational power for advanced AI model training and operation. Oracle, in turn, is poised to become a dominant force in global cloud infrastructure, investing heavily in new data centers and NVIDIA AI chips.
In a groundbreaking development poised to reshape the landscape of artificial intelligence infrastructure, OpenAI has entered into a colossal $30 billion annual cloud services agreement with Oracle. This landmark deal, confirmed by multiple reports following Oracle’s initial undisclosed announcement, is designed to fuel OpenAI’s burgeoning AI projects, most notably its ambitious ‘Stargate’ initiative.
The agreement, which is expected to begin contributing to Oracle’s revenue in fiscal year 2028, represents one of the largest cloud technology contracts ever signed in the AI sector. Under its terms, OpenAI will gain access to an unprecedented 4.5 gigawatts (GW) of data center power from Oracle’s infrastructure. To put this into perspective, 4.5 GW is an immense sum of energy, equivalent to the capacity of multiple nuclear reactors and capable of powering millions of American homes, underscoring the intense computational demands of cutting-edge AI development.
This partnership is a critical component of OpenAI’s ‘Stargate’ project, a massive global initiative launched earlier in 2025 with an estimated total investment that could reach up to $500 billion. The project aims to construct a vast network of AI data centers worldwide. Oracle’s involvement will focus on building and populating these data centers with essential resources, including a significant order of approximately 400,000 NVIDIA GB200 high-performance AI chips, crucial for training and running advanced AI models.
For Oracle, this deal marks a significant strategic victory, fundamentally transforming its position in the high-stakes AI cloud infrastructure market. The $30 billion annual revenue from this contract alone is projected to nearly triple Oracle’s 2025 cloud revenue of $10.2 billion by fiscal year 2028. Oracle founder Larry Ellison has articulated an ambitious vision, stating in a recent investor briefing, ‘Oracle will become the largest builder and operator of cloud infrastructure data centers worldwide in the coming years.’ He further emphasized, ‘Oracle will be the number one cloud database company. Oracle will be the number one cloud applications company, and Oracle will be the number one builder and operator of cloud infrastructure data centers. We will build and operate more cloud infrastructure data centers than all of our cloud infrastructure competitors combined.’ The company has committed an initial $7 billion investment to this venture, with plans to spend up to $25 billion by 2026 on expanding its cloud infrastructure.
Oracle plans to construct new data centers across multiple U.S. states, including Texas, Michigan, Wisconsin, Wyoming, New Mexico, Georgia, Ohio, and Pennsylvania. This expansion includes the further development of the existing 1.2-gigawatt Abilene data center in Texas, which was developed and financed by Crusoe.
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For OpenAI, diversifying its infrastructure providers beyond a single dominant partner like Microsoft is a crucial strategic move, ensuring greater resilience, optimizing compute resources, and fostering agility in a rapidly evolving technological landscape. This partnership positions OpenAI to remain highly competitive with other tech giants in meeting the escalating demands of AI innovation. The company is also reportedly adopting newer technologies such as liquid cooling and energy-efficient chips, signaling a long-term commitment to sustainability and scalability in its operations.
