Oracle shares plummet dragging down AI stocks Nvidia, Coreweave

Oracle shares plummeted 11% in premarket trading on Thursday, extending yesterday’s losses after the firm reported disappointing results.

The cloud computing and database software maker reported lower-than-expected quarterly revenue on Wednesday, despite booming demand for its artificial intelligence infrastructure. Its revenue came in at $16.06 billion, compared with $16.21 billion expected by analysts, according to data compiled by LSEG.

It dragged other AI-related names down with it. Chip darling Nvidia was last seen down 1.5% in premarket trading, memory and storage firm Micron was 1.4% lower, tech heavyweight Microsoft dipped 0.9%, cloud company Coreweave slid 3% and AMD was 1.3% in negative territory.

Oracle has been the subject of much market chatter since raising $18 billion in a jumbo bond sale in September, marking one of the largest debt issuances for the tech industry on record. The name shot onto investor agendas when it inked a $300 billion deal with OpenAI in the same month. Oracle made further moves into cloud infrastructure, where it battles Big Tech names such as Amazon, Microsoft and Google for AI contracts.

Global investors have questioned Oracle’s aggressive AI infrastructure build-out plans and whether it needs such a colossal amount of debt to execute, though other tech firms have also recently issued corporate bonds.

Oracle specifically has secured billions of dollars of construction loans through a consortium of banks tied to data centers in New Mexico and Wisconsin. The firm will raise roughly $20 billion to $30 billion in debt every year for the next three years, according to estimates by Citi analyst Tyler Radke.

Its share price has moved 34% higher year-to-date despite recent losses.