Oracle has struck a five-year, roughly $7 billion deal to rent about 100,000 advanced AI chips to Tencent across its Southeast Asian data centers, the Financial Times reports. Neither company has commented, and neither has named the chips involved.

The estimated rate works out to about $1.60 per chip per hour over five years, with roughly 30% paid upfront, per the FT. That price is about 43% below the roughly $2.80 per GPU-hour for Nvidia's H100 on a one-year contract, per research firm SemiAnalysis in August. It also sits about 48% under the $3.09 per GPU-hour for a three-year Nvidia B200 contract, per a 2025 filing by Japanese data center operator Datasection for an unnamed customer.

The discount stands out because market pricing is moving the other way. Chief Strategy Officer James Mitchell said on Tencent's August 12 earnings call that compute rental prices keep climbing. Tencent president Martin Lau said on the same call the company could sell its existing orders at "more than 30% profit" compared to what it "paid just a few months ago."

What chips are involved?

No hardware is named. The FT says such leases could reach even Nvidia's top processors, but that does not mean this deal involves Nvidia. On SemiAnalysis's index, one-year H100 contracts ran about $1.70 per GPU-hour as of October 2025 — still above the estimated Oracle rate — while the B200 costs more despite its longer, three-year term.

Raw B200 server costs — excluding buildings, power, networking, and financing — put 100,000 units at $5.44 billion, or about 78% of the reported deal value, based on Datasection's 2025 purchase of servers with 5,000 B200s for $272 million. Without specifics, it is impossible to say whether this is a bulk deal or whether leasing costs track actual hardware cost. The pricing on paper fits Hopper-class chips at volume. Hopper includes the H100 and H200, and with H200 imports still restricted, such chips would meet the criterion of being unavailable in China.

Where will the capacity run?

The Oracle data centers sit outside China; Tencent is renting time on them. Countries, sites, and a start date remain undisclosed. Oracle operates two Singapore cloud regions and has announced a Malaysia region. The FT reports the biggest clients of Southeast Asian data centers are ByteDance and Alibaba, with Chinese firms using the capacity chiefly for AI training that domestic chips cannot yet handle. Tencent previously signed a $1.2 billion-plus deal for Datasection Blackwell rentals in Japan and Australia, the FT reported in December 2025.

The structure matches Oracle's recent financing pattern. Since its March call, some Oracle clients have prepaid for GPUs or brought their own hardware; fiscal Q4 (March to May) added $67 billion of AI contracts, mostly of those two kinds, per its June call. From June through August, Oracle's quarterly filing states the company "received $11.4 billion of prepayments from customers that included a significant financing component." Deferred revenue rose from $15.4 billion to $30.8 billion over the quarter. No customers were named, so none of this can be tied to Tencent. Oracle reported 97.9% GPU utilization at its September 10 earnings call, with renewals at a 20% average premium, mostly on GPUs four years or older.

Tencent's roughly 30% prepayment makes sense against those statements. Oracle would improve cash flow after a quarter of negative free cash flow, while Tencent Cloud's May price increases, per Mitchell, could help recoup the cost of the rented chips.

Is the deal legal?

Such leases remain legal under current U.S. rules, per the FT, but the regulatory picture is tightening.

• The Remote Access Security Act, a bipartisan bill that passed the House 369–22 in January, would let the U.S. government regulate remote cloud access to sensitive technology. It targets cloud loopholes and applies to any foreign person rather than naming countries. It now sits in the Senate Banking Committee.
• Export Administration Regulations license requirements under the Commerce Department's Bureau of Industry and Security have covered advanced AI chip shipments — including to China-headquartered companies abroad — since November 2023. Cloud rentals were left out; the BIS has only asked for comment on them.
• Bloomberg reported the BIS is reviewing offshore access, with legal rentals included. The Information reports the Department of Commerce is drafting a rule to block Chinese firms from renting compute in third countries such as Thailand and Singapore — details that would align with this deal.
• The deal is not barred by Tencent's presence on the Pentagon's 1260H list of "Chinese military companies," which is not a sanction. No regulatory official commented alongside the report.

The Information reports that Commerce's drafted rule cannot be enforced under current law, per an attorney at Baker McKenzie.

What happens next?

President Donald Trump and Chinese President Xi Jinping met late last month in Washington, discussing AI and extending a trade truce for two more months. The leaders agreed to set up a channel for handling AI-related incidents, but nothing was announced on chip controls. The U.S. has cleared some firms, including Tencent, to buy Nvidia's H200, yet China has admitted only about 10,000 for Tencent so far, the FT reported in August. The next meeting, at APEC in Shenzhen in November, may clarify the situation.

Oracle's Investor Day on October 28 in Las Vegas, part of its October 25–28 Oracle AI World event at the Venetian, offers a venue to disclose details such as the leased hardware. Tencent reports Q3 results the following month. Given the hardware math, the more plausible reading is older or non-Nvidia hardware rather than a sign of financial stress at Oracle.