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Saturday, October 18, 2025

Oracle to Buy $40 Billion in Nvidia AI Chips to Power OpenAI Data Centers – What It Means for Cloud and AI in Africa

In a massive show of force in the generative AI space, Oracle is reportedly planning to purchase as much as $40 billion (±R745 billion) worth of Nvidia AI chips to build out one of the largest AI-focused data center operations in the United States. The chips will be used to power OpenAI’s next-generation artificial intelligence models, according to a Bloomberg report.

This move signals Oracle’s intention to compete head-on with other cloud giants like Microsoft, Amazon, and Google, all of whom are racing to support the rapidly growing demand for AI computing infrastructure. The chips — Nvidia’s highly sought-after H100 and upcoming B200 GPUs — are central to training and running large language models like ChatGPT.

Oracle’s Big Bet on AI

This deal, if confirmed, would represent one of the largest single AI chip purchases ever. Oracle’s close partnership with OpenAI could transform its position in the cloud infrastructure market. Historically known for enterprise software and databases, Oracle is now betting big on AI-as-a-Service (AIaaS), fueled by its OCI (Oracle Cloud Infrastructure) platform.

OpenAI, the creator of ChatGPT, has previously relied heavily on Microsoft’s Azure cloud. However, with AI workloads growing at an exponential pace, diversifying compute resources has become a priority. Oracle is poised to become a critical infrastructure provider in OpenAI’s next phase of expansion.

What This Means for South Africa and the Continent

While this may seem like a US-centric development, the implications for Africa’s digital economy are significant:

  • Cloud access and AI services: Oracle’s expanded infrastructure may accelerate access to advanced AI services across its global regions — including Africa. This could improve local access to cutting-edge AI tools for businesses, developers, and startups.

  • Nvidia’s chips shortage: The global scramble for Nvidia GPUs has created a bottleneck for AI innovation. Oracle’s massive deal could further constrain global supply, potentially delaying local access to affordable AI computing power for African universities, labs, and small enterprises.

  • Digital skills and investment: Oracle’s commitment to AI could spur more AI-related training, partnerships, and investment in emerging markets. South Africa, already showing potential in AI development and education, could benefit from regional Oracle infrastructure upgrades or partnerships.

  • Cloud competition in Africa: With Microsoft Azure, Amazon Web Services (AWS), and Google Cloud investing in African data centers, Oracle’s AI-focused expansion could increase competition — potentially lowering prices and improving services across the board.

AI is Infrastructure Now

The takeaway is clear: AI is no longer a feature — it is foundational infrastructure. Oracle’s $40 billion chip buy underscores how cloud providers are racing to become the backbone of the AI revolution.

As South African developers, businesses, and educators look to adopt AI into their workflows, the hope is that this global momentum will translate into local opportunity — through improved access to AI compute, expanded training, and inclusion in global digital supply chains.

We may not be building $40 billion data centers (yet), but the ripple effects of deals like this will shape Africa’s digital destiny for years to come.

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