Musk's xAI negotiates Oracle cloud server rental: Reports

Shares of Oracle (ORCL) are trading higher on Tuesday following a report hinting at a potential deal with Elon Musk's artificial intelligence venture. According to The Information, Musk's AI startup, xAI, is reportedly engaged in talks with the tech giant to rent cloud servers over a period of years in a deal worth a staggering $10 billion.

Yahoo Finance's Josh Lipton and Julie Hyman break down the details.

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This post was written by Angel Smith

Video transcript

And we've got another tech trending ticker to check on.

And that's Oracle.

Those shares are getting a little bit of a lift today.

After the information reported that Elon Musk's a I start up Xa I has been in talks with Oracle about spending $10 billion to rent cloud servers.

Now we knew that the two parties were in talks.

Larry Ellison used to be on the Tesla board, remember?

So he has a connection with us, but we didn't know how much this contract potentially would be worth.

Yeah, I mean, Ellison has talked about Listen, Ellison musk are close friends.

Um, so they know one another.

Well, a couple of points I would just make in this story.

I know the stock is popping, but it does look like the story is based on one source.

So I just want to highlight that for viewers, the other immediate question I had was whether Xa I really has $10 billion to spend.

I mean, I don't know, um maybe I mean, there are reports that the company in talks to raise billions out there.

Um, I'm gonna listen to Ellison and Musk, our close friends, Reuters actually reminded me, and I have forgotten that Xa I did sign a contract back in September to train a I models in Oracle's cloud.

Um, so who knows?

Maybe well, And the other interesting note in this report, by the way, is that in the recent reports about, uh, XI I raising money, Oracle may have been part of that funding round, so they're funding the company, but they're also a customer of the company.

If you're in Oracle, obviously, this is exactly why you're in the name.

Because you want your betting on exactly this kind of traction and momentum in the cloud business so you can get the excitement.

Well, we'll look for some sort of confirmation if this is actually happening.