Oracle is rapidly scaling up its data center capacity to meet surging demand for artificial intelligence compute services, positioning itself as a dominant player in the next-generation cloud infrastructure market. As of early 2025, hyperscalers operate 1,189 data centers, 44% of the global total, a share projected to grow to 61% by 2030. Oracle is firmly in that race, aggressively expanding its footprint to serve AI workloads.

A landmark development in this effort is Oracle’s extension of its “Stargate” partnership with OpenAI, through which OpenAI will lease an additional 4.5 gigawatts of power capacity, enough to support 2.3 million high-performance GPUs. This deal, reportedly valued at $30 billion annually and tied to Oracle’s broader $500 billion initiative, effectively transforms Oracle into a hyperscaler-level cloud provider for AI.

Oracle is not just building capacity; it’s front-loading investment. Planning to double its capital expenditure in 2025, up from around $10 billion, to over $20 billion, the company is deploying billions more to alleviate supply constraints and scale out its data center infrastructure. That commitment reflects surging cloud service revenues and a growing pipeline of AI-centric deals.

Oracle’s strategy is yielding investor confidence: its shares have recently surged, reaching record highs on the back of the OpenAI contract announcement and a bullish revenue outlook. TD Cowen analysts forecast cloud revenue growth exceeding 50% by fiscal 2028, while institutional investors are reacting positively to Oracle’s climb in commodities and cloud capacity.

Beyond OpenAI, Oracle is building new data centers and expanding existing ones across multiple U.S. regions—including Abilene, Texas, Michigan, Wisconsin, and Georgia—to service an expanding roster of AI-driven clients. It now operates over 100 cloud regions, a number CEO Safra Catz expects to grow further as component supply constraints ease.

Oracle’s pivot reflects a broader industry trend—hyperscalers seeing explosive growth in AI workloads are investing heavily to close the gap in compute capacity. By aligning data center expansion with strategic partnerships and long-term power purchase agreements like Stargate, Oracle is betting on its ability to sustain growth and become a central force in the AI-era cloud ecosystem.