Oracle has denied reports that discussions for a $3 billion deal with Microsoft fell apart due to security and compliance concerns.

Oracle told Reuters that these claims - which were laid out in a Business Insider (BI) report - are "innaccurate."

The BI article, published on June 16, said that people familiar with the matter had informed the publication that Microsoft was recently in talks with Oracle about a contract valued at more than $3bn to lease compute capacity.

The talks, however, BI said, fell apart as Oracle did not have the necessary security framework in place. Known as the Federal Risk and Authorization Management Program (FedRAMP), this ensures cloud services are secure enough to handle US government data, and Oracle was reportedly unwilling to add this framework.

An unnamed Oracle executive reportedly told BI that adding the framework would be a "massive engineering lift."

Oracle has, however, denied these claims.

In an email to Reuters, Oracle said: "The details mentioned in the article are ​inaccurate. Microsoft ⁠is both an OCI partner and a customer. We have a tremendously collaborative and fruitful partnership, where we ⁠often ​talk about ways we can expand ​upon our ongoing work together."

Microsoft declined to comment to BI.

Earlier this year, Microsoft agreed to lease 700MW of data center capacity from Crusoe's data center campus in Abilene, Texas, that was previously slated for Oracle and OpenAI. The company, like other major hyperscalers, has been rapidly expanding its data center footprint. During its Q3 FY2026 earnings call held in late April, CEO Satya Nadella revealed that the company's capacity expansion plans remain "on track to double our overall footprint in just two years."

That quarter alone, the company stood up 1GW of capacity.

Earlier this month, Oracle posted its Q4FY2026 earnings and full-year results. During the call, the company noted that it signed $67bn in AI infrastructure contracts in Q4, which are primarily bring-your-own hardware or prepaid, and has brought 1.2GW of capacity online throughout the full year of FY2026, with 1GW expected in the first quarter of 2027.