Microsoft winds down its AI cloud rental deal with Oracle as older Nvidia chips lose favour, Bloomberg reports
What's the deal? Microsoft is winding down a 2023 arrangement to rent AI computing capacity from Oracle, Bloomberg reported on 6 November 2026, citing people familiar with the matter. Microsoft has spent recent months switching off the rented capacity after declining to renew the contract. The Oracle servers, originally used to run Microsoft's AI-powered Bing search, ran older-generation Nvidia chips that no longer fit Microsoft's specifications. The size of the deal was never disclosed.
What the companies say: Microsoft declined to comment. An Oracle spokesperson said demand for its AI infrastructure "remains strong, including for earlier-generation GPUs". Oracle shares fell about 3% on the report.
Why it matters: Bloomberg said the move is part of a wider review of the more than $80 billion Microsoft has committed to renting capacity from outside providers such as CoreWeave, Nscale and Nebius, whose costs and delays have frustrated its leadership. This week Microsoft also reportedly passed on an option to more than double its Texas deal with Nscale. Rented GPU capacity is financed on the assumption that chips keep earning for years, so a large tenant handing back older hardware is a signal for lenders and other neocloud landlords.
Read more: Bloomberg, The Next Web
Image: Microsoft office building (Or Hakim / Unsplash via The Next Web)
