00:00Breaking news on the Bloomberg terminal. Oracle and OpenAI are apparently ending plans to expand
00:06that Texas data center site. This is Stargate. Remember, it was just yesterday where Brody
00:10Ford here at Bloomberg reported that Oracle was planning to cut thousands of jobs as it was
00:15dealing with the cash crunch from a massive AI data center expansion effort. And now a new report
00:20out by Brody Ford, Ed Ludlow and Dina Bass saying that Oracle and OpenAI have scrapped plans to
00:26expand that flagship AI data center in Texas after negotiations dragged on over financing
00:32and OpenAI's changing needs. Ed Ludlow joining us right now. Ed, give me some more details on this.
00:37What's going on? Yeah. So it's the Abilene site. You know, there's an agreement already in place
00:42to do 1.2 gigawatts. And what we're reporting is that Oracle has decided not to proceed with the
00:49expansion to 2 gigawatts. At the same time, our understanding from sources is that Meta has
00:55come into the equation and is negotiating in early talks with Crusoe, which is the developer of the
01:02site, to be the tenant to take on, to lease that capacity of the planned expansion now that Oracle
01:10is going to walk away from it. What is interesting here is that we also understand that NVIDIA
01:16made a $150 million deposit or payment to Crusoe to ensure that whatever happens in that next phase of
01:24expansion in Abilene, it is their compute, their GPUs that power it and not AMDs. So a lot of moving
01:32parts here, when we broke the story, you saw Oracle go from reasonable gains to now pretty firm,
01:37negative territory. What I would say is that Oracle has a broader 4.5 gigawatt agreement with OpenAI.
01:43That's very much intact. They're proceeding with other projects. This is just focused on the Abilene,
01:49Texas site. And so we will see whether Meta will come in and take on that additional capacity as it
01:55expands. But our understanding is there were some issues with how the site was operating,
01:59some financing issues, and also OpenAI's needs have changed. And you see all three of those names
02:04moving in reaction to this reporting remain.
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