Oracle Shares Tumble 40% on OpenAI Debt-Financed AI Commitment
Oracle shares have plunged by roughly 40% since late October as investors fret over debt-financed AI data center commitments tied to OpenAI’s planned $1.4 trillion compute spend. Goldman Sachs has nonetheless added Oracle to its AI-resilient long basket alongside Microsoft, Palo Alto Networks and Cloudflare.
1. OpenAI Commitments Pressure Oracle
Shares have fallen roughly 40% since October as investors question debt-financed AI data center investment tied to OpenAI’s pledged $1.4 trillion compute spend. Oracle has raised tens of billions to fund capacity and faces skepticism over sustainability of rapid expansion.
2. Stock Performance Metrics
Between October 31 and February 16, Oracle shares declined from $261.92 to $160.14, a 38.9% drop, outpacing the 22.4% and 11.9% losses at Microsoft and Broadcom over the same period. This steeper slide underscores heightened market concern over Oracle’s AI workload exposure.
3. Goldman Sachs AI-Resilient Trade Strategy
Goldman Sachs designated Oracle as a long position in its new AI-resilient pair trade basket, citing the company’s infrastructure role alongside Microsoft, Palo Alto Networks, CrowdStrike and Cloudflare as poised to benefit from accelerated AI adoption.