Oracle's Earnings Miss Triggers Stock Decline Amid AI Bubble Concerns

Thu Dec 11 2025 08:53:36 GMT+0200 (Eastern European Standard Time)

Oracle's shares fell more than 10% after the company's revenue report fell short of Wall Street expectations, raising concerns about AI bubble sustainability.

Cloud computing giant Oracle experienced a significant drop in stock value of over 10% in after-hours trading following the release of its latest revenue figures. While the company reported a 14% revenue growth, it fell short of analyst expectations, raising fears over a potential AI bubble as investors express concern about Oracle's massive OpenAI partnership. Amid scrutiny over increased debt and aggressive spending in AI, Oracle's chairman cautioned on the rapid changes in the technology landscape.

Shares of cloud computing giant Oracle plunged more than 10% in after-hours trading on Wednesday after the company's revenues fell short of Wall Street expectations.

The company reported revenue of $16.06bn (£11.99bn) for the three months that ended in November, compared with the $16.21bn projected by analysts.

Revenue growth was up 14%, with a 68% surge in sales at its AI business, Oracle Cloud Infrastructure (OCI), the company said.

OCI services major AI technology developers whose demand for Oracle's AI infrastructure helped the company's shares reach new highs this fall but Wednesday's results failed to quell fears about a potential AI bubble.

In September, Oracle agreed a highly sought-after contract with ChatGPT-maker OpenAI, securing a commitment of $300bn in computing power over five years.

Oracle chairman and chief technology officer Larry Ellison briefly became the world's richest man in after the announcement, but recent share performance tells a different story. The firm's shares have lost 40% of their value since peaking three months ago, although they are still up more than a third since the start of the year.

In a statement issued on Wednesday, Mr. Ellison struck a cautious tone, indicating that the rapid developments in AI would require Oracle to remain agile.

He also suggested a flexible approach to sourcing hardware, stating, We will continue to buy the latest GPUs from Nvidia, but we need to be prepared and able to deploy whatever chips our customers want to buy, referring to this strategy as "chip neutrality."

Oracle is engaged in several AI infrastructure partnerships that have raised questions about 'circular financing,' where companies finance their own products and services.

Jacob Bourne, an analyst at Emarketer, voiced concerns about Oracle's expanded debt to fund data center development, noting a record $18bn bond sale in September.

Bourne stated, Although Oracle's shares are buoyed by its September surge, this revenue miss will likely exacerbate concerns among already cautious investors about its OpenAI deal and its aggressive AI spending.

The Ellison family, known for their support of former US President Donald Trump, is also making headlines with a recent purchase of Paramount and efforts to acquire another major Hollywood studio, Warner Brothers Discovery.