AI stocks plummeted on Thursday, led by Nvidia’s 1.3% decline, as cloud-computing giant Oracle reported weaker-than-expected earnings and a hefty capital expenditure forecast for 2026.
Oracle shares slid over 11% in premarket trading after the company guided for lower-than-expected earnings and a $50 billion expansion plan. This increased investors’ concerns about the company’s debt risk and its ability to deliver returns on investment.
Nvidia, which has major contracts with Oracle to supply data center chips, was also affected by the news. Rival cloud firm CoreWeave fell over 3% and other AI-related stocks declined between 0.5% and 1%.
The decline in AI stocks was partly due to increased skepticism about OpenAI’s prospects amid growing competition from Google and other players. Oracle has sold billions of dollars’ worth of bonds to fund its AI ambitions, raising concerns about its debt risk.
Investors can expect more volatility in the AI sector as companies continue to expand their spending plans. Meanwhile, top Wall Street analysts offer insights on Oracle, Nvidia, and AI stocks through InvestingPro’s upgrade.
Source: https://www.investing.com/news/stock-market-news/nvidia-ai-stocks-fall-after-oracle-earnings-underwhelm-4402102