Oracle’s shares are down sharply in extended trading, weighing on US stock futures. The tech giant’s concerns about its artificial intelligence (AI) bet have resurfaced, with investors worried that the company’s investment in AIs, including privately-held OpenAI, might not pay off.
Investors fear that Oracle’s AI spending is too focused on catering to one major customer, OpenAI. This has raised concerns about whether the investments will deliver returns. Oracle’s shares are down 13% in premarket activity, with other AI stocks also declining. However, some of the top tech giants, including CoreWeave and SoftBank, have seen smaller declines.
The company’s expectation for capital expenditures to reach $50 billion by May 2026 has added to investor concerns. Oracle already has a significant amount of debt, estimated at over $106 billion, which is expected to swell to $290 billion by 2028.
OpenAI is a major player in the AIs market and has received significant investment from tech giants like Google. However, investors are growing concerned about whether OpenAI’s trillion-dollar spending plans will pay off. The company’s publicly traded business partners, including Oracle and SoftBank, have been impacted as investors take out their worries on these companies.
The AI ecosystem is increasingly interconnected, which raises concerns if any major hub falters. The Fed has also hinted at a possible pause in rate cuts, which could further impact the market sentiment.
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– Is the Fed done cutting rates?
Source: https://www.nytimes.com/2025/12/11/business/dealbook/ai-spending-oracle-openai.html