Oracle Corporation's stock suffered a staggering 19% decline this week, marking its worst weekly performance since the dot-com crash of 2001. The sell-off came as investors grew increasingly wary of the company's massive artificial intelligence infrastructure spending and its ballooning debt, which reached $130 billion. The plunge occurred against a backdrop of a broad technology stock rout that has pushed many Wall Street favorites deep into bear market territory.
Oracle's capital expenditures more than doubled in fiscal 2026 to $56 billion, up from $21.2 billion the prior year, as it raced to build out data centers to support AI workloads. Much of that spending is tied to a deepening partnership with OpenAI, including the Stargate initiative to construct multiple AI campuses across the U.S. — a venture that also involves SoftBank. While Oracle reported a record $638 billion in remaining performance obligations driven by AI demand, negative free cash flow and the escalating debt load overshadowed the growth narrative.
The broader tech sell-off was equally punishing. Coinbase has fallen 69% from its all-time high, while other notable losers include Oracle and Salesforce (down 57% each), ServiceNow (56%), Netflix and Palantir (48%), and Microsoft (37%). Even the Magnificent Seven have not been spared, with every member losing at least 8% in June. The Nasdaq Composite finished lower for a fifth straight day on Friday, and semiconductor stocks faced renewed pressure amid worries over AI infrastructure spending levels. The weakness extended globally, hitting European chipmakers and Asian tech giants like Tencent, Alibaba, and Xiaomi.
Oracle's debt surge, from $92.6 billion a year ago to $130 billion by May 31, 2026, has intensified scrutiny. Unlike competitors like Amazon, Microsoft, and Alphabet — which offer complete technology platforms — Oracle's narrower focus leaves investors focused on rising leverage and thinning margins. The sell-off underscores a pivotal moment for the company as it bets its future on AI, with markets questioning how quickly those bets will pay off.
