- Operai signs a $ 300 billion oracle contract from 2027 to expand the capacity of AI
- Oracle shares jump more than 40 percent after informing $ 317 billion in future revenues
- The agreement increases the risks since Openai loses money and Oracle assumes a great debt
Operai has signed a contract with Oracle to buy a computer power worth $ 300 billion in the next five years, according to the Wall Street Journal.
This makes it one of the largest cloud offers ever reached.
The contract will begin in 2027 and it is expected to remodel the way in which Operai builds and executes its artificial intelligence models.
A great bet
The agreement will require 4.5 gigawatts of energy capacity, which is sufficient electricity to supply around four million homes.
It shows how the rush to build AI data centers is promoting new maximums in technological spending, even when the questions remain if demand will justify such commitments.
Oracle revealed in his latest earnings report that added $ 317 billion in future contract revenues during the quarter that ended on August 31, partly due to the OpenAI agreement.
The news sent Oracle’s actions to fly by more than 40 percent in a single day. This increase increased the richness of the president of Oracle, Larry Ellison, by more than $ 100 billion, and saw him advance Elon Musk as the richest person in the world with a net worth close to $ 400 billion.
However, the agreement is not exempt from mass risk for both parties.
For Openai, the agreement provides a new source of computer power after years of trusting Microsoft’s Azure Cloud, but WSJ He says that the company, which reported around $ 10 billion in income this year, owes Oracle an average of $ 60 billion annually under the agreement.
The startup is losing money and has told investors that it does not expect to make profits until 2029.
Meanwhile, Oracle will have to borrow to finance the chips and infrastructure necessary to deliver the contract.
Also, like WSJ He informed: “The agreement is based on the assumption of Chatgpt will continue its explosive growth and will be adopted by billions of people worldwide, as well as the main companies and governments.”
Industry analysts say that the association underlines both the promise and the tension of the AI boom. It is projected to spend on chips, servers and data centers worldwide will reach $ 2.9 billion by 2028.
If Openai’s growth can maintain the rhythm of his commitments remains an open question.
