Oracle announced on Tuesday that it is deepening its collaboration with OpenAI, embedding the AI lab's ChatGPT and Codex tools into Oracle's software applications. The goal is to make the data held in company databases easier to put to practical use.
Mahesh Thiagarajan, president of Oracle Cloud Infrastructure, spoke to CNBC at Oracle AI World in Las Vegas. He said ChatGPT "allows anybody to build an application, deploy it, manage it." OpenAI CEO Sam Altman was scheduled to join Oracle co-CEO Clay Magouyrk on stage for a keynote at 12:40 p.m. ET.
The news extends OpenAI's push into the enterprise market and arrives one day after rival Anthropic filed its S-1 on the road to an initial public offering. Oracle's database underpins businesses in sectors such as healthcare and finance, where it logs and secures data. Thiagarajan said his team watched OpenAI's GPT-6 Astra model being trained at Oracle's Stargate data center campus in Abilene, Texas, and saw the benefits in real time. In the press release, OpenAI president and co-founder Greg Brockman said more businesses are choosing OpenAI as it becomes easier to apply AI through tools and systems they already use.
Oracle also said it is widening the hardware available on its cloud infrastructure. Google's tensor processing unit AI chips and OpenAI's Jalapeño chip will be offered, and Cerebras systems will also run on Oracle Cloud Infrastructure. "Now customers can actually have infinite possibilities in terms of how they can drive AI," Thiagarajan said.
It is the first time Google's custom chips will run on another hyperscaler's cloud, a sign that chipmakers are increasingly looking to place their hardware with the leading AI labs. Thiagarajan said chip scarcity remains an ongoing problem and that customers such as OpenAI benefit from a choice of accelerators. Asked whether this signals a move away from Nvidia GPUs, he said no, calling Nvidia's chips "the best, most fungible" and noting the AI market is very large.
A Cerebras spokesperson said the deal with Oracle is material, but the company will not disclose its scale because it is in a quiet period. Cerebras stock rose about 8% after the news, and Oracle shares gained nearly 5% on Tuesday. The announcement follows by seven months Amazon Web Services' plan to bring Cerebras hardware into its data centers, which was seen as a major point of validation.
Thiagarajan also addressed Oracle's multibillion-dollar data center in New Mexico, known as Project Jupiter, which faces continuing opposition from the local community. He said it is one of 30 to 40 data center projects the company has in development each quarter. "We're actually not too worried about what we're doing because I think we're building global infrastructure," he said.
A hearing on air quality permitting is set for Dec. 7 in Sunland Park, where construction has already begun. Political pushback tied to the project led Oracle to send a force majeure notice to its backer, Blue Owl Capital, last month. Oracle says the project remains on schedule.
Attention is now turning to Oracle's upcoming investor day. Investors want to know whether the company can support its fiscal year 2030 revenue targets and whether the margins on its cloud deals have shifted because of rising capital costs. Bank of America analysts told clients they expect clarity on major data center projects. Oracle shares are down more than 30% this year, partly over concerns about how the company will finance its infrastructure buildout.
