Meta signs $10 billion cloud deal with Google

Google has entered into a six-year cloud computing agreement with Meta Platforms valued at over $10 billion, a source familiar with the matter told Reuters on August 21. 

The deal marks Google’s second major cloud partnership in recent weeks, following a separate agreement with OpenAI.

According to the source, who requested anonymity due to the confidential nature of the discussions, Meta will rely on Google Cloud’s servers, storage, networking, and other related services under the terms of the deal.

Neither Google nor Meta has yet responded to requests for comment regarding the agreement. 

The development follows Meta CEO Mark Zuckerberg’s announcement in July that the company plans to invest hundreds of billions of dollars in building several massive AI data centres.

Last month, Meta adjusted the lower end of its annual capital expenditure forecast upward by $2 billion, setting the range at $66 billion to $72 billion.

In a filing earlier this month, Meta revealed that it is seeking external partners to help finance its large-scale infrastructure projects, including efforts to offload $2 billion in data centre assets to meet the growing demands of its artificial intelligence operations.

This deal also comes as industry players intensify collaborations in the AI and cloud sectors. In June, Reuters reported that OpenAI was planning to expand its use of Alphabet’s Google Cloud services to accommodate its increasing computing needs — a notable move given the competitive dynamics between the companies.

Meanwhile, Google’s cloud division has shown strong performance, posting nearly a 32% year-on-year revenue increase in the second quarter, surpassing market expectations, according to results released in July.

By Tamilla Hasanova