Oracle‘s (ORCL -2.72%) stock price jumped 36% in a single session on Sept. 10 after the company announced plans to increase Oracle Cloud Infrastructure (OCI) revenue by more than 14-fold in five years. But that news proved to be just one splash amid a sea of waves.

Reports indicate that Oracle and Meta Platforms (META -0.65%) are in talks on a $20 billion cloud computing deal. And Oracle and OpenAI are building on their $300 billion partnership with the rollout of five new data centers custom-built for artificial intelligence (AI).

Despite its expensive valuation, here’s why Oracle continues to stand out as one of the best AI stocks to buy among the “Ten Titans,” which is the “Magnificent Seven” plus Broadcom, Oracle, and Netflix.

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1. Oracle is building the future of AI data centers

Established cloud giants like Amazon (AMZN 0.78%) Web Services (AWS), Microsoft (MSFT 0.88%) Azure, and Alphabet‘s (GOOG 0.21%) (GOOGL 0.28%) Google Cloud serve a variety of general compute customers. However, Oracle’s data centers are specifically designed for AI.

Oracle is a good example of why lacking a first-mover advantage isn’t a deal-breaker. Oracle’s data centers are newer and faster. And it’s bringing over 70 of them online in just a few years, which is why it expects OCI growth to reach an inflection point in fiscal 2027.

When it comes to high-performance computing, OCI is magnitudes faster than alternatives — saving customers time and money for AI workflows. Oracle achieves this advantage by embedding native versions of its database services into the big three clouds to boost performance. This is why I’m predicting Oracle will become the top cloud for AI by 2031, making it one of the best cloud computing stocks to buy for risk-tolerant investors.

2. Oracle is landing major deals with leading hyperscalers

Oracle is winning high-value contracts across the AI landscape, from Meta Platforms to OpenAI. Reports are that Oracle’s $20 billion deal with Meta involves a multiyear agreement for training and deploying Meta’s AI models.

The OpenAI deal is the backbone of Oracle’s five-year roadmap. But it depends on OpenAI raising money — as OpenAI is unlikely to turn free cash flow positive anytime soon.

Fortunately, that doesn’t seem to be a problem. OpenAI plans to transition from a nonprofit to a Public Benefit Corporation, which is a corporation with philanthropic and community impact requirements rather than a purely profit-driven objective. On Sept. 22, Nvidia (NVDA 0.27%) announced up to a $100 billion investment in OpenAI to power next-generation AI models. This is great news for Oracle, as its cloud growth depends on OpenAI’s financial stability.

On Sept. 23, OpenAI said that it is teaming up with Oracle and SoftBank on five new AI data centers under its Stargate AI infrastructure platform. In that press release, OpenAI put a dollar figure of over $300 billion on its 4.5-gigawatt (GW) Stargate capacity partnership with Oracle. The company also said that Stargate’s capacity will be nearly 7 GW and over $400 billion of investment over the next three years, and reach $500 billion of committed investment, or 10 GW of committed capacity, before the end of the year. This 10 GW number is the same figure used by Nvidia in its strategic partnership announcement, which aims to invest progressively in OpenAI as each GW is deployed.

This is all great news for Oracle, which will collaborate with Nvidia to develop data center and cloud computing infrastructure for OpenAI. This powerhouse of a partnership provides a clear runway for sustained earnings growth for Oracle. And it justifies its aggressive capital expenditure ramp-up and leveraged balance sheet.

3. Oracle continues to grow its partnerships with AWS, Azure, and Google Cloud

An integral aspect of Oracle’s investment thesis is that its competitors are also its customers. AWS, Microsoft Azure, and Google Cloud are major Oracle customers through OCI’s multicloud offering.

Multicloud enables customers to manage workloads across multiple cloud providers while leveraging the Oracle database. The idea is to minimize data movement by bringing AI to the dataset rather than bringing the dataset to the cloud provider. Again, this goes back to Oracle embedding native versions of its database into the big three cloud providers, which reduces latency costs and lowers compliance risk.

AI is an exciting investment opportunity because it unlocks a new way to leverage data through large language models across text, images, audio, video, and code. By bringing the dataset to the source rather than moving it around, AI models can operate much faster and at a lower cost, which helps Oracle win business even if customers use a rival cloud provider instead of OCI.

Oracle is worth its premium price

Oracle is a pure-play business-to-business company. It doesn’t have a lot of moving parts and consumer-facing divisions like Amazon, Microsoft, or Alphabet. It can win business by offering its integrated suite of cloud, database, and enterprise software services, or leverage its database services with a different cloud giant.

Based on multicloud alone, Oracle already had a compelling investment thesis before the announcements with Meta and OpenAI. But these deals take Oracle to the next level by showcasing the value of its next-generation data centers and its cross-selling opportunities for enterprises.

Oracle stock has run up a lot in recent years. It’s far from cheap at 46.1 times forward earnings. However, the price is arguably worth it for investors who believe that Oracle will play a pivotal role in OpenAI’s data center buildout for years to come.