OpenAI is poised to enter a $300 billion agreement with Oracle over five years, providing crucial compute capacity to advance Sam Altman’s AI initiatives. This contract, starting in 2027, aims to secure five gigawatts of compute power, essential for the company’s growth, yet raises concerns about funding, as OpenAI projects a profit only by 2029. In addition to this, SoftBank is reportedly investing $19 billion in the OpenAI-led Stargate project, which focuses on constructing large AI data centers. Recently, Oracle’s commitment to OpenAI saw a rise in its share price by over 30%, signaling strong investor confidence. Oracle’s CEO forecasts a significant revenue increase for its cloud infrastructure business, expecting annual revenues to rise from $18 billion today to $144 billion by 2031. As this agreement unfolds, the sustainability of OpenAI’s financial strategy remains a critical focal point for investors and industry observers alike.
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