The massive agreement underscores AI’s soaring infrastructure demands under the $500B Stargate project
OpenAI has agreed to lease 4.5 gigawatts of data center power from Oracle Corp., marking one of the largest computing infrastructure deals in history and highlighting the immense energy requirements of next-generation artificial intelligence models.
The computing power, enough to supply millions of U.S. homes, will be delivered through Oracle’s growing network of data centers across the country, with expansion already underway at its Abilene, Texas facility. That site’s capacity is expected to increase from 1.2 GW to 2 GW, and additional centers are being considered in Michigan, Wisconsin, Wyoming, and New Mexico, among others.
This unprecedented arrangement forms part of Stargate, OpenAI’s $500 billion global initiative to build out AI infrastructure in partnership with Oracle, SoftBank, and others. The scale of the deal was hinted at earlier this week when Oracle disclosed a $30 billion annual cloud agreement set to begin in fiscal 2028—without naming the client. Sources have confirmed this Stargate deal comprises at least part of that announcement.
Oracle, once best known for its database software, has gained significant traction in the cloud infrastructure space by catering to AI-centric clients like OpenAI. Its pivot has driven strong stock performance, with shares climbing 5% to a record high of $229.98 and gaining 38% year-to-date.
Despite the bullish sentiment, S&P noted that Oracle’s aggressive expansion was straining cash flow, though the firm still views the long-term strategy positively given the structural shift toward AI computing.
The Stargate initiative, which also includes partners like Nvidia, Cisco, and UAE-backed G42, aims to create the physical backbone for AI’s global future, with Oracle emerging as a key beneficiary of the AI arms race.
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