Oracle Stock Plummets 60% Amid Massive AI Spending
Oracle Corporation shares dropped nearly 60% as aggressive AI infrastructure spending led to negative cash flow and a credit rating downgrade.
Shares of Oracle Corporation have declined nearly 60% from a 52-week high of $322.54, trading at $132.60 as of September 30, 2026. The collapse diverges from other technology megacaps and stems from a massive surge in capital expenditures to build data center infrastructure for AI workloads. Spending jumped 163% to $55.7 billion in fiscal 2026, with total AI project investments reaching $95 billion.
This spending spree has severely strained the company's balance sheet. Oracle reported negative free cash flow of $23.7 billion in fiscal 2026 and another $5.4 billion loss in the first quarter of fiscal 2027. To bridge the gap, the company sold $20 billion in stock and accumulated $125 billion in long-term debt. S&P Global responded by downgrading Oracle's credit rating from BBB to BBB-, placing the company near junk bond status.
Despite the financial volatility, Oracle reported record 30% revenue growth, with fiscal 2026 revenue reaching $67.4 billion. Cloud infrastructure revenue surged 121%, and remaining performance obligations total $664 billion. However, the company faces $288 billion in future data-center lease commitments. Oracle recently issued a legal notice to the developer of Project Jupiter, a massive data center campus, claiming "force majeure" to potentially postpone lease payments if the facility is not completed by March 2028.
