Oracle’s AI Bet Makes—and Breaks—Billionaires in One Day

Larry Ellison’s net worth saw a dramatic $34 billion swing as Oracle’s stock surged nearly 40% in a single day following a surprise $300 billion AI infrastructure deal with OpenAI. The deal, described as one of the largest cloud contracts in history, sent Oracle’s market capitalization soaring to a record high of $970 billion intraday, briefly making Ellison the world’s richest person with a net worth of nearly $400 billion. However, by market close, the stock had settled at $328, reducing Ellison’s fortune to $383 billion, where he tied with Elon Musk before a slight rebound in Tesla shares restored Musk’s lead.

The deal, which is part of Oracle’s broader $455 billion in remaining performance obligations, represents a major pivot for the company in the AI infrastructure space. Oracle’s aggressive pursuit of top-of-the-line Nvidia GPUs, facilitated by close ties between Ellison and Nvidia CEO Jensen Huang, has positioned the company as a key player in supporting the next generation of AI models. Oracle’s cloud infrastructure business now accounts for a projected 77% revenue growth to $18 billion in the current fiscal year and is expected to grow further to $144 billion in four years.

Despite the deal’s scale, concerns are mounting over its financial viability. Analysts warn that OpenAI’s current revenue—estimated at $12 billion annually—falls far short of the $60 billion in annual capital expenditures required to fulfill the Oracle contract. According to reports, OpenAI would need hundreds of billions in revenue to sustain the deal, raising red flags about the risk of default or renegotiation. Moody’s Ratings has acknowledged Oracle’s “tremendous potential” in AI but also highlighted the concentration risk of relying heavily on a single unproven client for the majority of its future revenue, while noting that Oracle’s leverage could rise significantly as debt growth outpaces EBITDA.

The broader AI sector is also under scrutiny for signs of a potential bubble. The Oracle-OpenAI deal has reignited concerns about overvaluation, especially as a recent MIT study found that 95% of AI pilot programs fail to deliver meaningful returns despite over $40 billion in investments. OpenAI CEO Sam Altman has also publicly expressed concern about a private market bubble in AI, while AI expert Gary Marcus called the Oracle deal “peak bubble.” Critics argue that the financial structure of the deal—essentially a non-binding contract with a nonprofit that has not yet secured for-profit status—creates unrealistic expectations for investors and may set the stage for a market correction.

Ellison’s short-lived ascent to the top of the wealth rankings highlights a broader shift in tech fortunes. Unlike Musk’s reliance on Tesla’s volatile stock, Ellison’s gains were driven by Oracle’s AI-driven cloud infrastructure growth, which has surged 97% year-to-date. This momentum has positioned Oracle as a serious player in the AI infrastructure race, with analysts suggesting the company is better positioned than Tesla to sustain long-term growth in a sector that is still in its early stages of adoption.