OpenAI has agreed to lease 4.5 gigawatts (GW) of computing power from Oracle in a deal worth about US$ 30 billion a year as part of its Stargate initiative, according to reports by the Financial Times and Bloomberg News, citing people familiar with the matter. The deal is one of the largest cloud contracts for artificial intelligence to date. The US$ 30 billion deal is more than the current size of Oracle’s entire cloud infrastructure business and is worth nearly triple the US$ 10.3bn in annual revenue the company generated from its data centre infrastructure business in 2025, the reports said.
To meet the additional demand from OpenAI, Oracle will develop multiple data centers across the US with partners, with sites in Texas, Michigan, Wisconsin and Wyoming under consideration. In addition, Oracle will also expand the Abilene site from a current power capacity of 1.2 GW to about 2 GW, the people said. Meanwhile, OpenAI is also considering sites in New Mexico, Georgia, Ohio and Pennsylvania, the people added.
A gigawatt is similar to the capacity from one nuclear reactor and can provide electricity to about 750,000 houses; 4.5GW would be equivalent to about a quarter of the US’ current operational data centre capacity.
These new projects will be part of Stargate, and details of the plans may still change, according to the people familiar with the plans.
First announced in January at the White House, Stargate is an OpenAI’s project with partners which include Oracle and SoftBank Group Corp. The partners plan to invest US$ 500 billion in AI infrastructure. So far, Oracle, together with development partner Crusoe, has developed a massive data center in Abilene, Texas, for OpenAI.
Oracle, known for its database software, has gained traction in the market for renting out computing power and storage over the internet, in part by targeting clients focused on AI work. This has led to a jump in revenue and expenses.
Credit ratings firm S&P wrote Wednesday that Oracle’s cloud infrastructure building spree was straining cash flow and that the current spending pace is higher than anticipated. Still, it viewed Oracle’s cloud strategy favourably over the long term.
OpenAI said in May it was helping develop a Stargate project in the United Arab Emirates with Oracle, Crusoe, AI chipmaker Nvidia Corp, Cisco Systems Inc. and G42, an AI company backed by the country’s sovereign wealth fund.
OpenAI and Crusoe declined to comment on the plans while Oracle did not immediately respond to press requests for comment.
Oracle was slow to enter the cloud computing market but has experienced a sharp increase in demand for data centre infrastructure as companies seek computing power to run AI systems.
