Oracle (ORCL.N) is reportedly negotiating a multi-year artificial intelligence cloud computing deal with Meta (META.O), the parent company of Facebook and Instagram, with a potential value of $20 billion. If finalized, this would mark a significant milestone in the rapidly expanding AI infrastructure market and could reshape the competitive landscape of both the cloud computing and social media sectors. The discussions center on Oracle supplying Meta with dedicated computing capacity, an essential need in Meta’s quest to train and deploy cutting-edge AI models at scale.
Inside the $20 Billion AI Cloud Deal
The Oracle-Meta agreement, now in advanced stages of discussion as reported by several industry and financial news outlets, focuses on Meta’s access to Oracle Cloud Infrastructure, commonly known as OCI. If inked, this deal is expected to span several years and will see Meta relying on Oracle’s high-performance GPU resources for the intensive task of building large artificial intelligence models. This would supplement Meta’s current partnerships with other cloud providers and boost the social media group’s capacity for AI innovation.
Oracle’s role in this deal is prominent for several reasons. First, the company would be providing Meta with the computational capability to execute deep learning workloads, including the substantial GPU rentals necessary for modern AI model development. Given the multiplying technical needs for AI infrastructure, Meta is thought to be scaling up its operations beyond its existing relationships with Amazon Web Services, Google Cloud, and Microsoft Azure.
Meta, which has declined to comment, is already an existing Oracle customer. However, the planned increase in scale for this deal could mark a transformative moment in cloud service delivery for both parties.
Why Oracle’s AI Business Is Surging?
Oracle Cloud Infrastructure has recently emerged as a major contender in the AI cloud landscape. In the third quarter of 2025, Oracle reported a 52% year-over-year jump in cloud infrastructure revenue, with GPU-centric workloads up by a record 336% thanks to growing demand from AI specialists like Meta and OpenAI. More impressively, Oracle’s cloud partnerships have led to revenue from collaborative deals with Amazon, Alphabet, and Microsoft rising more than sixteen-fold in the first quarter of 2025.
Beyond Meta, Oracle’s signing of a $300 billion contract with OpenAI over five years for data center capacity spotlighted Oracle’s strategic push in dominating AI cloud deals, dwarfing many historical arrangements in the sector. In parallel, Oracle has recently closed four multi-billion-dollar contracts with other major AI firms, feeding a broader industry trend where massive spending on computing power has become essential for maintaining market share.
This AI momentum has positively impacted Oracle’s financials: For full-year fiscal 2025, Oracle posted total revenues of $57.4 billion, powered by cloud services and license support revenues of $44 billion, and a 12% rise in operating cash flow to $20.8 billion. Technology stocks responded strongly, with Oracle’s market performance outperforming some rivals following recent earnings releases.
Meta’s AI Ambitions and Strategic Motivations
Meta has invested heavily in AI, from launching custom chips to pioneering models like Llama that power recommendations and generative technologies in its social ecosystem. In a bid to optimize these workflows for speed and scale, Meta requires not just more compute power, but also flexible access to the most advanced GPU resources, such as those offered by Oracle’s global data centers.
The partnership under discussion would grant Meta faster and more reliable access to cloud-based GPUs, underpinning efforts to build next-generation AI systems for content moderation, user safety, personalized feeds, and generative content – the core of Meta’s future business strategy. Oracle’s offering is particularly compelling due to its adaptable deployment models, which allow Meta to run critical workloads on OCI while maintaining links to other cloud vendors.
Industry experts believe the agreement could accelerate Meta’s competitiveness in the broader AI sphere, benefiting Meta’s ability to deploy advanced algorithms and optimize real-time workloads. Given the growing importance of generative AI across industries, Meta’s move underscores the strategic necessity of securing reliable and cost-efficient infrastructure at scale.
Wider Market Implications
The Oracle-Meta negotiations are a signal of accelerating consolidation in AI infrastructure. Sector-wide competition is intensifying, with rival firms like xAI recently notching a $10 billion capital raise at a $200 billion valuation, and Anthropic securing $13 billion in funding – all underscoring the current AI investment frenzy.
Oracle’s own plans to spend approximately $35 billion on the construction of 37 new data centers in 2026 reflect the substantial capital outlay required to stay relevant in a field marked by relentless demand. Oracle has made it possible for cloud customers of Amazon, Alphabet, and Microsoft to run Oracle Cloud Infrastructure alongside native cloud services – a move described by analysts as a strategic effort to establish Oracle as a hybrid AI provider of choice.
