Oracle cancels $7B Tencent AI chip deal under Trump's pressure
What's the story
Oracle has scrapped a multi-billion dollar artificial intelligence (AI) chip leasing contract with Chinese tech giant Tencent. The decision comes after pressure from the Trump administration, according to Financial Times. The five-year deal was originally signed last month and was worth an estimated $7 billion. It would have given Tencent access to around 100,000 advanced AI chips that are currently not available in China due to restrictions imposed by Washington and Beijing.
Official intervention
US government intervened in deal
The Financial Times report said US officials had approached Oracle with their concerns about the Tencent deal.
Meanwhile, Tencent also received visits from senior officials in Guangdong, where it is headquartered. These officials urged the company to back domestic Chinese chips.
The move comes as Chinese AI developers increasingly look for overseas access to advanced processors amid US export restrictions.
Market shift
Chinese AI developers seek overseas access to advanced processors
Chinese tech companies are among the biggest customers of data centers in Southeast Asia.
They are now renting access to AI accelerators not available in their home country, including those from American firm NVIDIA Corp.
This trend is a direct response to US export controls and highlights the growing demand for advanced technology among Chinese AI developers.