What is true
Oracle–OpenAI $300B deal
OpenAI has signed a $300 billion, five-year contract with Oracle (from 2027 onward) for cloud compute services under what’s called the Stargate project. This announcement sent Oracle’s stock soaring roughly 36 to 40 percent in a single day, its best performance since 1992.
Oracle uses NVIDIA hardware / GPUs
Oracle needs powerful compute to deliver large-scale AI cloud services. NVIDIA chips are the dominant hardware for training and inference, so Oracle will almost certainly need to procure massive amounts of NVIDIA (and possibly other) hardware to meet OpenAI’s demand.
NVIDIA → $100B investment in OpenAI
NVIDIA has announced plans to invest up to $100 billion in OpenAI as part of a deal to build out AI data center capacity of 10 gigawatts of NVIDIA systems. As part of this partnership, OpenAI will be buying NVIDIA systems and hardware.
What is inferred or more speculative
Oracle says OpenAI committed $300B for cloud compute → Oracle stock jumps 36%
This part is clear and confirmed.
Oracle runs on NVIDIA GPUs → has to buy billions in chips
Broadly true: Oracle must buy hardware to deliver its obligations, and NVIDIA is the leading supplier. The “billions” figure is directional rather than exact. Oracle may also use multiple vendors, though NVIDIA dominates high-end AI chips.
NVIDIA just announced $100B into OpenAI
Confirmed: NVIDIA has committed to this scale of partnership and investment.
OpenAI uses that money to pay Oracle → Oracle pays NVIDIA → NVIDIA invests in OpenAI
This is where things get more complex. There is indeed a feedback loop, but it is not a perfect circle of cash. Some of NVIDIA’s contribution is hardware and infrastructure, some is equity, and the timing is spread over years.
How the circularity works — and where it breaks
NVIDIA → OpenAI: NVIDIA invests through equity, infrastructure, and hardware partnerships, which boosts OpenAI’s access to compute.
OpenAI → NVIDIA: OpenAI purchases NVIDIA systems and hardware as part of its expansion.
OpenAI → Oracle: OpenAI commits $300B to Oracle’s cloud services under Stargate.
Oracle → NVIDIA: To meet OpenAI’s demand, Oracle invests in GPUs, much of it sourced from NVIDIA.
So there is indeed a cycle: OpenAI pays Oracle, Oracle pays NVIDIA, and NVIDIA invests in OpenAI.
But:
NVIDIA’s investment is not pure cash; it is a mix of hardware, equity, and strategic partnership.
The flows are phased: Oracle’s contract begins in 2027, NVIDIA’s deployments start in 2026, and the spending rolls out over years.
Oracle’s spending also covers power, cooling, staff, and operations, not just NVIDIA hardware.
Bottom Line
In broad strokes, this setup does create a feedback loop. OpenAI commits enormous spending with Oracle, Oracle buys GPUs from NVIDIA, NVIDIA invests in OpenAI, and the cycle supports itself. But the reality includes equity stakes, hardware contributions, timing differences, and significant operational costs that make it more complex than a simple cash circle.