Oracle Cloud to deploy 50,000 AMD AI chips as an alternative to Nvidia

Oracle Cloud Infrastructure announced Tuesday that it would deploy 50,000 Advanced microdevices graphics processors from the second half of 2026.

The move is the latest sign that cloud computing companies are increasingly offering AMD GPUs as an alternative to from Nvidia Market-leading GPUs for artificial intelligence.

“We think customers are going to adopt AMD very, very well, especially in the inference space,” Karan Batta, senior vice president of Oracle Cloud Infrastructure, told CNBC’s Seema Mody.

Oracle will use AMD’s Instinct MI450 chips, announced earlier this year.

These are AMD’s first AI chips that can be assembled into a larger system allowing 72 chips to work as one, which is necessary to create and deploy the most advanced AI algorithms.

OpenAI CEO Sam Altman appeared with AMD CEO Lisa Su at a company event in June to announce the product.

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

He added that AMD’s software stack is “critical” and that “customers are going to adopt AMD very, very well in the inference space.”

Earlier this month, OpenAI announced a deal with AMD for processors requiring six gigawatts of power over several years, with a 1-gigawatt rollout starting in 2026. As part of the deal, and if the rollout goes well, OpenAI could end up owning up to 160 million shares of AMD, or about 10% of the company.

In September, OpenAI struck a five-year cloud deal with Oracle that could be worth up to $300 billion.

OpenAI has always been closely linked to Nvidia, whose chips were used to develop ChatGPT. Nvidia’s chips dominate the data center GPU market with over 90% market share. Nvidia also invested in OpenAI in September.

But OpenAI executives say the company needs as much computing power as possible, which means it needs AI chips from multiple vendors. OpenAI also plans to design its own AI chips with Broadcom.

On Tuesday at Oracle AI World, founder and chairman Larry Ellison is expected to take the stage and share his views on the latest OpenAI deal and what his company is doing to stay ahead of its major cloud competitors: Microsoft, Amazon And Google.

“Oracle has already shown that it is willing to bet big and pull out all the stops to meet the AI ​​moment. The company must now prove that beyond capacity, it can capitalize on its massive underlying data and enterprise capabilities… to add significant value to the enterprise AI wave,” Daniel Newman, CEO of The Futurum Group, said on the sidelines of Oracle’s conference.