Oracle's $300 Billion OpenAI Deal Isn't Enough to Stop a 36% Monthly Stock Rout
04.07.2026 - 01:11:50 | boerse-global.de
The numbers on Oracle's books are the stuff of AI-era fantasy: a $638 billion backlog of unfulfilled performance obligations, including a single five-year contract with OpenAI worth more than $300 billion that kicks off in 2027. Yet investors have turned their backs on the software giant with a ferocity that has erased over half the company's market value from its September 2025 peak. The stock now trades at €126.48, down 54.94% from the record high of €280.70 and 36.36% lower in the last month alone.
The Cash Burn That Overshadows the Backlog
Wall Street's current preoccupation is not what Oracle will earn in 2027, but what it is spending right now. The company is pouring roughly $95 billion into expanding its data centers to handle that massive order book – a figure that blindsided analysts, who had expected around $68 billion. To fund this aggressive build-out, management plans to raise some $40 billion through a mix of new debt and equity offerings.
Last fiscal year, capital expenditures already surged to nearly $56 billion, pushing free cash flow deep into negative territory at –$23.7 billion. Total liabilities have climbed to almost $219 billion, with long-term lease obligations adding a similar amount, and interest-bearing debt alone tops $100 billion. Rating agencies have begun flagging concentration risks as the company's balance sheet buckles under the weight of its own ambition.
Should investors sell immediately? Or is it worth buying Oracle?
Technicals Flash Oversold, But Momentum Says Otherwise
The stock's technical picture looks like a textbook oversold bounce candidate. The relative strength index sits at 30.5, teetering on the edge of deeply oversold territory – a level that has kept analysts at KeyBanc and Mizuho holding buy ratings with an average price target of €220.78, implying a 74.6% upside from current levels. Yet the 30-day annualized volatility of 71.48% screams crisis mode, not stabilization. The shares are trading 21.19% below their 50-day moving average of €160.49, a chasm that suggests any recovery will be steep and slow.
The Glut Fear That Haunts Hyperscalers
Oracle's pain is compounded by a growing anxiety across the tech sector about an oversupply of AI computing capacity. Major players like Meta have signaled they may sublease excess capacity, stoking fears that the premium pricing that fueled the AI gold rush could normalize before Oracle's new data centers reach full utilization. The company's Gen2 cloud and superclusters are an all-in bet on sustained demand for high-end infrastructure, but the "glut scare" narrative is gaining traction.
A Test of Capital Efficiency
For now, Oracle's management is asking the market to trust that the $638 billion backlog will eventually translate into high-margin, recurring revenue. But the immediate calculus favors capital efficiency over grand promises. The stock's brief relief rally of 2.88% on the latest session barely registers against a nine-day losing streak. With the balance sheet stretched and the hyperscaler arena increasingly crowded, the next few quarters will determine whether Oracle's infrastructure gamble pays off – or whether the stock has further to fall.
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