Oracle debt raises concerns on data center funding

Investor concerns about Oracle (ORCL) have moved beyond its share price and into its project financing. Oracle shares have fallen nearly 50% from their all-time high reached on Sept. 10. The decline has intensified scrutiny of the company’s balance sheet and debt levels.

Asset manager Blue Owl Capital has withdrawn from a planned $10 billion Oracle data center project. The Financial Times reported the exit was due to unfavorable debt terms tied to the project.

The decision has raised concerns about Oracle’s ability to fund large-scale infrastructure projects. Attention has focused on data centers intended to support OpenAI, which Oracle is building.

On Friday that Oracle could delay completion of those facilities. Oracle has denied that report. Oracle shares fell 5.4% on Wednesday. The drop brought the company’s losses for the month to more than 11%.

The decline weighed on other technology stocks linked to artificial intelligence infrastructure. Shares of Broadcom, Nvidia, and Advanced Micro Devices moved lower during the session.

Broader U.S. equity markets also fell. The S&P 500 declined 1.16%, while the Dow Jones Industrial Average dropped 0.47%. The Nasdaq Composite fell 1.81%. It marked the index’s worst session in nearly a month.

The market move came amid a broader pullback in artificial intelligence-related stocks. Recent gains in the sector have drawn increased attention from investors and analysts.

Bank of America said it believes the artificial intelligence trade could continue into 2026. The bank noted that further gains do not rule out the formation of a market bubble.

Analysts at the bank said recent price movements support their view that a larger bubble may be developing in the sector. They also cautioned that identifying the timing of a potential downturn remains difficult.

The developments around Oracle add to ongoing market volatility. Investors are closely watching debt levels, capital spending plans, and their impact on technology infrastructure projects.