Oracle invests $40 billion in Nvidia chips to build one of the largest data centers globally

Oracle commits $40 billion to Nvidia chips for a huge AI-targeted data center in Texas by 2026.

: Oracle is investing $40 billion in Nvidia's high-performance chips to construct a data center in Abilene, Texas. This facility, part of the $500 billion Stargate project, aims to transform global AI computing and will demand up to 1.2 gigawatts of power at full capacity. OpenAI, alongside SoftBank, is a major driver behind this initiative, with plans for a rigorous global expansion involving 20 sites. Significant partnerships involve financial backing from Crusoe Energy Systems, Blue Owl Capital, and a substantial loan contribution from JPMorgan.

Oracle plans to power a vast new data center in Abilene, Texas, by purchasing Nvidia's latest chips for $40 billion. The facility will need up to 1.2 gigawatts of electricity once fully operational. Serving as the central hub of the Stargate project, this venture aims to dramatically reshape the AI computing scene in the U.S. and overseas. The Stargate project is an ambitious $500 billion initiative led by OpenAI and SoftBank, with the initial funding targeting the Texas center and up to 20 other sites globally. The facility will initially utilize approximately 400,000 Nvidia GB200 superchips, encompassing eight buildings across 875 acres.

Financing for this significant undertaking involves various players, with Crusoe Energy Systems and Blue Owl Capital securing $15 billion in debt and equity. JPMorgan significantly contributed by providing a $9.6 billion loan package, including a major $7.1 billion component recently acknowledged. Upon completion in mid-2026, the Texas data center is set to rank among the largest globally and is crucial for OpenAI’s AI model training, as well as deployment operations. This move marks a shift from its dependency on Microsoft towards more diversified cloud partnerships.

OpenAI is in the midst of stepping away from its exclusivity arrangement with Microsoft, as the need for computing power began surpassing Microsoft’s available resources. Although discussions persist regarding Microsoft’s licensing rights to OpenAI's models, the establishment of the data center in Texas embodies a significant shift to diversify its cloud engagements. The global ambitions surrounding the Stargate project extend beyond the U.S., with additional strongholds being envisioned in Europe and Asia to meet growing demands.

The Stargate project's scope involves a massive financial commitment, with plans for expansive rollouts in various regions to buttress the rapidly advancing AI sector. Key equity holders in this $500 billion venture include SoftBank and OpenAI, each holding 40 percent stakes. Oracle and MGX, an investment firm from the UAE, have invested $7 billion each, with SoftBank overseeing finances and OpenAI guiding operations. This consortium is strategically positioned to fortify infrastructure crucial to AI advancements worldwide.

An essential part of OpenAI’s expansion is a 10-square-mile AI campus in Abu Dhabi, developed in collaboration with Emirati tech firm G42. This site, which could demand 5GW of power—quadruple that of the Texas center—is projected to house over two million of Nvidia's most advanced chips, affirming its role as a linchpin in the “OpenAI for Countries” initiative. These efforts collectively seek to lay down the supercomputing foundation necessary to propel AI innovations well into the future.

Sources: TechSpot, Financial Times

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