OpenAI agreed to pay Oracle $30B a year for data center services

OpenAI has confirmed it signed a landmark $30 billion per year deal with Oracle for data center services, a contract initially disclosed by Oracle in late June without naming the customer. This agreement is part of OpenAI’s ambitious Stargate project, a $500 billion initiative to build massive data center capacity. Specifically, the deal covers 4.5 gigawatts of power—equivalent to the output of two Hoover Dams—enough to power about four million homes. The data center, known as Stargate I, is being constructed in Abilene, Texas, and represents a significant expansion of infrastructure to support OpenAI’s rapidly growing computational needs. While the deal has propelled Oracle’s stock to record highs and made its founder Larry Ellison the world’s second richest person, the project poses substantial challenges. Building and operating such a large-scale data center will require enormous capital and energy expenditures. Oracle has already spent $21.2 billion on capital expenditures in its last fiscal year and plans to