President Donald Trump announced a joint venture to fund artificial intelligence infrastructure worth billions of dollars with the leaders of Softbank Group, OpenAI, and Oracle Corp, an effort aimed at speeding development of the emerging technology.
“We’re starting off with tremendous investment coming into our country at levels that nobody’s really ever seen before,” Trump said at the White House on Tuesday.
Trump was joined by Softbank’s Masayoshi Son, OpenAI’s Sam Altman, and Oracle’s Larry Ellison. The joint venture will deploy US$100 billion ($135.36 billion) “immediately” and have a goal of increasing to “at least” US$500 billion in AI projects, including data centers and physical campuses, Son said. Companies including Microsoft, and Nvidia are also expected to participate.
The president said he would use emergency declarations and executive action to help ease construction projects, including through easier access to energy. During their remarks, Trump and the executives highlighted potential applications for AI in health and other fields that would fuel US economic growth.
“AI holds incredible promise for all of us, for every American,” Ellison said.
Still, the actual scope of new commitments in the announcement remained unclear.
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Son visited Mar-a-Lago just last month to announce that Softbank would spend US$100 billion over the coming presidential term, and Tuesday’s announcement was drawn from that effort, according to a person familiar with the matter. Ellison said some of the data centers being considered for the project were already under construction, and OpenAI has also already extensively outlined plans to invest in AI infrastructure.
Over 400 shares in the S&P 500 rose during trading Tuesday, with the gauge up almost 1%, on expectations that Trump would unveil the new AI investment push. Oracle shares rose 7%, while a closely watched exchange-traded fund tracking companies with AI exposure hit a three-year high.
Trump has signaled a wide-ranging approach to ensure US leadership in AI. Two weeks before taking office, he announced a US$20 billion investment from Dubai-based billionaire Hussain Sajwani for new data centers across the US. On Monday, shortly after his swearing-in, he rescinded AI guardrails imposed by Joe Biden and signed a series of measures to boost US energy development to meet a surge in power demand from data centers.
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But skepticism remains about whether the initiative — dubbed “Stargate” by the companies — actually amounts to a dramatic increase from previous plans. Last month’s announcement from Son stirred questions over where SoftBank would get the capital to fund its initiative. The company had 3.8 trillion yen in cash and equivalents on its balance sheet at the end of September.
Since winning a second term, Trump has cozied up to Silicon Valley, with prominent executives including Elon Musk, Mark Zuckerberg, Jeff Bezos, Tim Cook and Sundar Pichai joining him at the US Capitol for his swearing-in ceremony on Monday.
OpenAI’s Altman has spent months trying to form a global coalition among government and industry leaders to support boosting the supply of chips, energy and data center capacity to support the development of AI. The company also pitched the Biden administration on the need for massive data centers that use as much power as entire cities.
SoftBank previously invested in OpenAI’s most recent fundraising round. OpenAI Chief Financial Officer Sarah Friar told Bloomberg News last month that it was drawn to SoftBank because the company has “access to lots of capital” and is prepared to invest that money, including “in areas like power and data centers.”
Cloud infrastructure providers like Microsoft Corp., Amazon.com Inc., and Oracle have been racing to expand computing capacity by constructing new data centers. Oracle has already committed billions to build out new data centers — the company is expected to double its capital expenditures this fiscal year to over US$14 billion, in large part due to these projects.
