Oracle partners with OpenAI to provide computing power for Stargate initiative, boosting stock 5%.

OpenAI has secured a significant amount of computing power from Oracle for its Stargate initiative. This agreement involves about 4.5 gigawatts of data center power in the US, which could power millions of American homes. Oracle recently announced a $30 billion cloud deal, with part of it likely going towards this partnership.

Stargate, OpenAI’s project with Oracle and SoftBank, aims to invest $500 billion in AI infrastructure. Oracle is expanding its data centers across the US to meet OpenAI’s demand, with potential sites in Texas, Michigan, Wisconsin, and more. These new projects are part of Stargate, with plans subject to change.

Oracle’s stock rose 5% after the news, reaching a record high of $229.98. The company’s focus on cloud services, particularly for AI work, has boosted revenue and expenses. S&P noted Oracle’s cloud infrastructure spending is straining cash flow but views the long-term cloud strategy positively.

OpenAI is also working on a Stargate project in the UAE with partners like Oracle, Nvidia, and Cisco. These collaborations highlight the growing importance of AI infrastructure development. Oracle’s cloud strategy, while facing some financial strain, is seen as favorable for the future by analysts.

Read more at Yahoo Finance: Oracle, OpenAI Expand Stargate Deal for More US Data Centers