Oracle shares fell 4.47% as aggressive AI spending and rising debt concerns weighed

Oracle shares fell 4.4657% in pre-market trading on December 15, 2025, as investor concerns over aggressive AI infrastructure spending and rising debt weighed on sentiment.

Despite a 54% year-over-year surge in non-GAAP earnings per share and record remaining performance obligations (RPO) of $523 billion, the stock faced selling pressure. Analysts highlighted Oracle’s mounting capital expenditures, which reached $20.54 billion in the first half of 2025, pushing free cash flow into negative territory. The company’s $108.1 billion debt load and high leverage in AI investments contrast with cash-generative peers like Amazon and Microsoft, raising questions about sustainability.

Oracle’s cloud revenue grew 34% year-over-year to $8 billion, driven by surging demand for AI infrastructure. However, execution risks around its $300 billion OpenAI contract and delayed data center timelines amplified near-term uncertainty. Management defended its spending strategy, aiming to expand 72 multicloud data centers by 2026, but analysts remain split, with some downgrading price targets amid margin concerns.

While Oracle’s long-term growth potential remains intact, the current valuation reflects heightened risks. Investors are weighing the company’s ability to convert RPO into revenue against cash flow challenges and debt dynamics as the stock trades at a forward P/E under 26. The selloff has created a buying opportunity for some, though execution risks and capital intensity will likely keep volatility elevated in the near term.