By Andre Savage
Publication Date: 2026-11-06 23:32:00
What happened
Microsoft has been phasing out a setup that let it rent AI computing from Oracle, an arrangement unveiled in 2023 to support a new AI-assisted version of Bing. In recent months, the company has been turning off that capacity after opting against renewing the contract, according to people with knowledge of the situation who asked not to be identified.
The total scope of the deal was not clear. Microsoft declined to comment.
Why Microsoft pulled back
The rented capacity became less useful over time because it no longer lined up with Microsoft’s technical requirements, the people said, adding that Oracle’s systems relied on older Nvidia chips. Microsoft’s readiness back then to lease servers from a direct competitor underscored how scarce AI processing power was at the outset of this boom.
That choice also sat inside a much larger rethink of cloud spending. As it declined to…
