Oracle backs AMD in AI chip race against Nvidia

• Oracle boosts AI capacity with 50,000 AMD chips.
• Expands AI and multi-cloud strategy with AMD and Cloudflare.

Oracle plans to deploy 50,000 AMD graphics processors starting in the second half of 2026, a shift in how cloud providers source chips for AI.

Shares of AMD rose slightly after the news, while Oracle fell nearly 3% in value and Nvidia dropped more than 4%.

The move shows how cloud companies are starting to offer AMD’s GPUs as an alternative to Nvidia’s dominant hardware for AI computing. “We feel like customers are going to take up AMD very, very well – especially in the inferencing space,” said Karan Batta, senior vice president of Oracle Cloud Infrastructure.

The chips in focus are AMD’s Instinct MI450, introduced earlier this year. They are AMD’s first AI processors that can be connected into a rack-sized system, allowing 72 chips to work together. That setup is designed to support the training and deployment of large-scale AI models.

OpenAI CEO Sam Altman appeared with AMD CEO Lisa Su during the chip’s unveiling in June. Earlier this month, OpenAI announced a deal to use 6 gigawatts-worth of AMD processors over several years, beginning with a 1-gigawatt rollout in 2026. If the deployment goes as planned, OpenAI could end up holding as many as 160 million AMD shares, about 10% of the company.

OpenAI also maintains a close partnership with Oracle. In September, the two firms entered a five-year cloud deal that could be worth up to $300 billion.

OpenAI relies on Nvidia chips, which make up more than 90% of the global data centre GPU market, with Nvidia investing in OpenAI last September. But the growing demand for computing power has led OpenAI to diversify its suppliers, including Broadcom, which is helping design custom chips for the company.

“I think AMD has done a really fantastic job, just like Nvidia, and I think both of them have their place,” Batta said.

At Oracle AI World, founder and chairman Larry Ellison is expected to discuss the company’s expanded role in AI and its competition with Microsoft, Amazon, and Google.

“Oracle has already shown it is willing to place big bets and go all in to meet the AI moment,” said Daniel Newman, CEO of The Futurum Group. “The company must now prove that beyond capacity, it can capitalise on its massive underlying data and enterprise capabilities to add meaningful value to the enterprise AI wave.”

In another development, Cloudflare will integrate its connectivity cloud platform with Oracle Cloud Infrastructure (OCI). The platform will be natively available in hybrid, multi-cloud, and OCI-hosted applications.

“We all see how AI is transforming the way organisations and their employees operate, and we need to pay equal attention to how AI is expanding our threat landscapes,” said Tom Evans, Cloudflare’s chief partner officer.

David Hicks, group vice president of ISV Ecosystem at Oracle, said the collaboration will help customers protect and manage cloud and AI workloads in different environments. “Together, we will give businesses the confidence to innovate and grow, knowing their applications and data are protected every step of the way.”

Oracle expanded its multi-cloud strategy recently, working with Microsoft, Google, and Amazon Web Services to host “Database@” services that place Oracle hardware inside competing data centres – a sign of how cooperation is becoming just as important as competition in today’s AI infrastructure.

Want to experience the full spectrum of enterprise technology innovation? Join TechEx in Amsterdam, California, and London. Covering AI, Big Data, Cyber Security, IoT, Digital Transformation, Intelligent Automation, Edge Computing, and Data Centres, TechEx brings together global leaders to share real-world use cases and in-depth insights. Click here for more information.