Oracle Sinks in Its Worst Week in 25 Years, Yet Analysts Stay Bullish
Oracle ended its worst trading week on Wall Street in 25 years, as investors grew increasingly worried about the software giant’s debt load and whether its massive bet on artificial intelligence will pay off. The stock fell 19% this week, its sharpest weekly drop since a 20% plunge in August 2001, during the dot-com bust.
The past nine months have been brutal for shareholders. Oracle reached a market value peak of $900 billion in September, but since then has lost 55% of its value. At the center of the concern is Oracle’s need to raise record amounts of debt to meet its AI infrastructure commitments, especially for OpenAI, while also focusing on lower-margin products. As of the end of May, Oracle carried about $130 billion in debt.
Oracle is racing to build data centers alongside Amazon, Microsoft and Google, but unlike those rivals it cannot sell a full cloud-services package. Earlier this month, the company said it plans to raise $40 billion in fiscal 2027 through debt and equity financing, including the $20 billion stock sale it had previously announced. Evercore analysts wrote on Wednesday that financing and the pace of share issuance will likely remain a key debate for investors in the near term, as long as demand signals stay strong.
Despite the selloff, most investment houses remain bullish. According to FactSet, about 71% of analysts rate the stock a buy, the highest share in 15 years. Oracle is also facing a broader selloff in software stocks, as investors worry AI models could replace many software capabilities. In its annual report last week, Oracle said its workforce fell 13% to 141,000 employees in fiscal 2026, with notable cuts in sales and marketing. Founder Larry Ellison missed the earnings call this month, leaving co-CEOs Clay Maguirek and Mike Sicilia and recently appointed CFO Hilary Maxon to answer questions. The stock decline also pushed Ellison behind Google founders Larry Page and Sergey Brin, Amazon founder Jeff Bezos and Michael Dell in the global rich list, though his fortune is still estimated at more than $200 billion.
