Oracle launches report on $10 billion cloud deal with Musk’s xAI

(Bloomberg) —Oracle Corp. gained as much as 5.3% after the Information reported that the company was nearing a deal for a $10 billion cloud contract with Elon Musk’s artificial intelligence startup xAI.

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Oracle Chairman Larry Ellison said last September that the company had reached an agreement to provide cloud infrastructure for xAI to train artificial intelligence models. Ellison did not disclose the value or length of the contract at that time.

“Geez, did they want a lot more” computing power, Ellison said of Oracle’s work with xAI at an event in December. “They wanted more and we are getting more from them. »

Musk’s xAI has been talking with Oracle about spending $10 billion to lease cloud servers for several years, the Information newspaper reported Tuesday, citing a person involved in the negotiations. Discussions are ongoing and there is no guarantee the companies will reach an agreement, according to reports.

The artificial intelligence startup was preparing to close a $6 billion funding round, valuing the company at around $18 billion, Bloomberg reported last week. It was unclear whether Oracle made an investment as part of this round, the news reported.

Oracle did not immediately respond to a request for comment.

The stock gained 3.7% to $120.68 at 12:25 p.m. in New York after reaching $122.55 previously. The stock was up 10% this year through Monday’s close.

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