Close Menu
CoinMagazine
    What's Hot

    Data Breach Rocks Blockchain Lending Platform Figure

    February 15, 2026

    Navigating Markets Amidst Walmart Earnings and Economic Indicators

    February 15, 2026

    Bitcoin’s Future in the Hands of Institutions: Quantum Threats and Developer Dynamics

    February 15, 2026
    Facebook X (Twitter) Instagram
    • Home
    • Business
    • Markets
    • Technology
    Facebook X (Twitter) Instagram
    CoinMagazine
    • Home
    • Features
      • Example Post
      • Typography
      • Contact
      • View All On Demos
    • Business

      Fidelity Buys 7.4% Of Bitcoin Mining Company Marathon Digital Holdings

      February 11, 2021

      Twitter Reacts as Auto Driver Begins Accepting Crypto as Payment

      February 11, 2021

      HSBC Becomes Latest Bank to Suspend Payments to Crypto

      February 4, 2021

      Bitcoin Holds Support; Approaching $50K Resistance

      February 4, 2021

      Cryptocurrency Prices Today: Bitcoin Up Over $47,000, Ether Rises 3%

      February 3, 2021
    • Typography
    • Technology
      1. Business
      2. Markets
      3. Insights
      4. View All

      Fidelity Buys 7.4% Of Bitcoin Mining Company Marathon Digital Holdings

      February 11, 2021

      Twitter Reacts as Auto Driver Begins Accepting Crypto as Payment

      February 11, 2021

      HSBC Becomes Latest Bank to Suspend Payments to Crypto

      February 4, 2021

      Bitcoin Holds Support; Approaching $50K Resistance

      February 4, 2021

      XRP Price Chart ‘Double Bottom’ Puts Next Bullish Target at $1

      March 16, 2021

      The Ripple Effects Of Bitcoin Legalization Worldwide

      February 4, 2021

      NCR Buys Cryptocurrency ATM Firm LibertyX – A Big Deal

      February 1, 2021

      Crypto Payment Systems Have Increased Over 70% This Year

      February 1, 2021

      PoS Coins, Lightning, DeFi & DEXes In Danger as US Bill Chaos Intensifies

      January 15, 2021

      Jack Dorsey Says Bitcoin Will Unite The World

      9.1 January 15, 2021

      Hong Kong Customs Arrest Four in Crypto Laundering Bust

      January 15, 2021

      PayPal’s Venmo Allows Credit Cardholders to Buy Crypto

      January 14, 2021

      Bitcoin Climbs as Elon Musk Says Tesla ‘Likely’ to Accept it Again

      March 16, 2021

      Can Cryptocurrency Be Hacked, Stolen Or Scammed? How Can You Be Safe?

      February 11, 2021

      How Investors Can Get In On Crypto Without Actually Buying Any

      February 4, 2021

      Ethereum Just Underwent a Major Change – Hence, The 25% Jump in a Week!

      February 4, 2021
    CoinMagazine
    Home»AI»Oracle’s Struggles Amid AI Ambitions: Is the Stock Still a Buy?
    Oracle's Struggles Amid AI Ambitions: Is the Stock Still a Buy? – featured image
    As Oracle's stock sees a dramatic fall of 55%, questions arise about its dependence on AI infrastructure and financial sustainability.
    AI

    Oracle’s Struggles Amid AI Ambitions: Is the Stock Still a Buy?

    CryptoCoinBizzBy CryptoCoinBizzFebruary 15, 2026No Comments4 Mins Read
    Share
    Facebook Twitter LinkedIn Pinterest Email

    Oracle Corporation (ORCL) has recently faced a severe stock sell-off, with shares plummeting nearly 55% from their all-time high of $345.72 in late 2025 to around $160. The significant drop can be attributed to deep investor concerns over the companys ambitious yet risky foray into AI infrastructure combined with a heavy debt load.

    The alarm bells began to ring back in September 2025 when Oracle inked a staggering $300 billion deal with OpenAI. This five-year agreement mandates Oracle to deliver an impressive 4.5 gigawatts of annual computing power capacity to the creator of ChatGPT, covering the period from 2027 to 2032.

    While this partnership establishes Oracle as an essential player in the AI infrastructure market, it has also fostered significant concentration risk. As of now, a striking 58% of Oracle’s contractual backlog is tied to OpenAI, rendering the company somewhat of a vital “publicly traded proxy” for the fortunes of the AI startup, as reported by several financial analysts.

    However, OpenAI itself is not without its challenges. New estimates indicate that the company might burn through an eye-watering $115 billion by 2029. Such potential cash depletion raises pertinent questions about whether OpenAI can fulfill its long-term financial commitments to Oracle.

    Moreover, Oracle has recognized that it cannot solely depend on client spending to fuel its ambitious projects. In February, the tech giant announced plans to raise between $45 and $50 billion in 2026 through a combination of debt and equity financing to support its ongoing capital projects. Notably, approximately half of this raise is expected to come from equity issuance, including $20 billion in common shares.

    Managing a Heavy Debt Load

    This new influx of capital will only add to Oracle’s already substantial debt burden, which was reported at around $100 billion in the fiscal second quarter ending November 2025. This hefty debt load will likely translate into increased interest expenses, placing additional strain on the companys bottom line for years to come.

    In light of these developments, Bernstein analysts revised their outlook for Oracle on February 9, adjusting the price target down from $339 to $313, while maintaining an Outperform rating. Their analysis suggests that the planned capital raise should adequately satisfy Oracle’s financial requirements through fiscal year 2028, though lingering uncertainties about returns from these significant investments remain a concern for investors.

    Another factor contributing to investor concerns includes trading activity by Oracle’s CEO, Clayton Magouyrk, who recently sold 10,000 shares at an average price of $155.23, amounting to $1.55 million in sales. Magouyrk still retains a substantial stake, holding 134,030 shares after the transaction.

    OpenAI’s Competitive Landscape

    OpenAI is also feeling the effects of increasing competition. Reports indicate that the market share of ChatGPT has dramatically fallen from 69.1% in January 2025 to just 45.3% by January 2026. This rapid decline raises critical questions about OpenAI’s capacity to maintain its market dominance against formidable rivals such as Anthropic and Google’s Gemini.

    Although Oracle’s portfolio does include other high-profile clients like TikTok and Nvidia, the heavy reliance on OpenAI significantly ties Oracle’s success to the fortunes of a single client and the scalability of generative AI.

    Current market evaluations show Oracle trading at a forward price-to-earnings ratio of 20, below the Nasdaq 100 average of 27. This apparent discount may not merely present a buying opportunity, but rather reflect substantial execution risks associated with the firm.

    In its fiscal second quarter report from November, Oracle showcased solid growth in cloud infrastructure revenue, highlighting the strength of its database management and cloud computing services. However, the question remains whether Oracle’s vast capital expenditures will translate into profitable growth or simply add to the company’s legacy as stranded assets.

    Bernstein estimates that the planned $45-$50 billion capital raise will adequately fund Oracles AI infrastructure goals through fiscal 2028, providing the company with a pivotal two-year window to validate its ambitious strategy.

    Share. Facebook Twitter Pinterest LinkedIn Tumblr Email
    Avatar photo
    CryptoCoinBizz

    CryptoCoinBizz is a leading cryptocurrency magazine focused on delivering insightful analysis, breaking news, and expert opinions on the dynamic world of digital currencies. Our mission is to empower readers with essential knowledge of blockchain technology and market trends. With a team of experienced journalists and industry experts, we provide valuable content for both novice and seasoned investors, fostering a community dedicated to informed decision-making in the evolving landscape of cryptocurrency.

    Related Posts

    Data Breach Rocks Blockchain Lending Platform Figure

    February 15, 2026

    Navigating Markets Amidst Walmart Earnings and Economic Indicators

    February 15, 2026

    Bitcoin’s Future in the Hands of Institutions: Quantum Threats and Developer Dynamics

    February 15, 2026

    Coinbase’s Tough Road Ahead: Analysts Slash Price Targets After Q4 Earnings Miss

    February 15, 2026
    Add A Comment
    Leave A Reply Cancel Reply

    Top Posts

    Millennials Are Quitting Job to Become Day Traders

    January 20, 2021

    Jack Dorsey Says Bitcoin Will Unite The World

    January 15, 2021

    Hong Kong Customs Arrest Four in Crypto Laundering Bust

    January 15, 2021

    Subscribe to Updates

    Get the latest sports news from SportsSite about soccer, football and tennis.

    Advertisement
    Demo

    Your source for the serious news. This demo is crafted specifically to exhibit the use of the theme as a news site. Visit our main page for more demos.

    We're social. Connect with us:

    Facebook X (Twitter) Instagram Pinterest YouTube
    Top Insights

    Data Breach Rocks Blockchain Lending Platform Figure

    February 15, 2026

    Navigating Markets Amidst Walmart Earnings and Economic Indicators

    February 15, 2026

    Bitcoin’s Future in the Hands of Institutions: Quantum Threats and Developer Dynamics

    February 15, 2026
    Get Informed

    Subscribe to Updates

    Get the latest creative news from FooBar about art, design and business.

    Type above and press Enter to search. Press Esc to cancel.

    하단 배너