S&P Global downgrades Oracle after $498B loss and OpenAI reliance
Business
Oracle just got its credit rating bumped down by S&P Global after losing about $498 billion in market value in less than 10 months.
The main reason? Oracle's big bet on AI infrastructure is heavily tied to a few clients, and nearly half of its future commitments depend on OpenAI.
S&P Global warns OpenAI contract risks
S&P warns that if OpenAI can't meet its contracts, Oracle could be left with pricey data center leases and less cash to work with.
With Oracle planning to spend up to $95 billion on AI projects for fiscal 2027, this makes their financial situation even riskier, especially since their cloud revenue is still catching up.