OpenAI plans $300B Oracle cloud deal over five years: Report

OpenAI is accelerating its race to secure computing power for artificial intelligence development with one of the largest cloud deals in history. According to The Wall Street Journal, the AI giant has agreed to spend $300 billion on Oracle’s cloud infrastructure over five years starting in 2027. This massive agreement highlights the growing demand for cloud capacity as AI firms expand at an unprecedented pace.

Oracle’s Earnings Boost from Mega Cloud Contracts

During Oracle’s quarterly earnings call on Tuesday, CEO Safra Catz revealed that three unnamed clients signed four multi-billion-dollar contracts in the first quarter of FY2026. These deals pushed Oracle’s cloud infrastructure revenue up by 77% year-on-year, sparking investor excitement.

The announcement drove Oracle’s shares higher in after-hours trading, reflecting strong market confidence in its expanding cloud business. Analysts suggest that OpenAI could be one of the key contributors to this revenue surge.

OpenAI’s $300 Billion Oracle Cloud Deal

The WSJ report claims that OpenAI has committed to purchasing $300 billion worth of computing power from Oracle, spread over five years. If confirmed, this would become one of the largest cloud contracts ever signed in the tech industry.

The deal is expected to commence in 2027 and would provide OpenAI with the vast computing resources needed to train and run its advanced AI models. The scale of this agreement underscores the intense competition for cloud infrastructure among major AI firms.

Expanding Beyond Microsoft Azure

OpenAI, which previously relied heavily on Microsoft Azure, began shifting part of its operations to Oracle’s infrastructure in mid-2024. This move marked a strategic diversification of cloud partnerships, allowing OpenAI to reduce dependence on a single provider and tap into Oracle’s high-performance infrastructure.
Oracle, in turn, has positioned itself as a key player in AI-driven cloud demand, competing against Microsoft, Google, and Amazon Web Services.

The $500 Billion Stargate Project

In January 2025, OpenAI, Oracle, and SoftBank announced the Stargate Project, a $500 billion initiative aimed at building massive domestic data centers. The project is designed to strengthen AI infrastructure and meet surging computational requirements, ensuring that OpenAI and its partners can sustain the next wave of AI development.

This project aligns closely with OpenAI’s long-term cloud strategy, of which the Oracle deal is a critical component.

OpenAI’s Multi-Cloud Expansion Strategy

The Oracle deal is not OpenAI’s only major cloud agreement. In 2025, reports surfaced that the company also signed a cloud services deal with Google, even though the two firms compete head-to-head in the AI industry.

By securing multiple partnerships across cloud providers, OpenAI ensures that it has redundancy, scalability, and bargaining power in its operations. This approach reflects the enormous compute requirements needed to train large language models and other AI systems.

Beyond Cloud: OpenAI’s Chip Partnership with Broadcom

In addition to cloud investments, OpenAI is also reportedly working on custom AI chips. Earlier this year, Reuters reported that OpenAI signed a $10 billion partnership with Broadcom to design and manufacture next-generation AI semiconductors.

This diversification strategy shows that OpenAI is not only securing cloud resources but also building its hardware foundation for the future of AI.

Oracle’s Record-Breaking Quarter

Alongside the OpenAI deal, Oracle revealed that it had added $317 billion in future contract revenue in Q1 2026. This unprecedented number sent Oracle’s stock soaring and significantly boosted the net worth of Chairman Larry Ellison, propelling him to the world’s richest person list.

The OpenAI deal, combined with other multi-billion-dollar contracts, cements Oracle’s reputation as a leading AI cloud provider.

Conclusion

The reported $300 billion Oracle cloud contract with OpenAI marks a turning point in the cloud computing industry. As AI adoption accelerates worldwide, firms like OpenAI are investing heavily to secure computing power, diversify cloud partnerships, and build dedicated infrastructure. For Oracle, this deal strengthens its competitive position in the AI-driven cloud era and adds immense shareholder value.