Oracle's stock has collapsed 30% this quarter—its worst performance since 2001—just three months into the tenure of new CEOs Clay Magouyrk and Mike Sicilia. The sell-off reveals a market-wide loss of faith in the database giant's ability to deliver on its blockbuster promise to build massive data centers packed with Nvidia chips for OpenAI, a commitment that was supposed to rescue the company from its cloud infrastructure backwater.
Three months ago, Oracle handed the keys to Clay Magouyrk and Mike Sicilia. They're already in the ditch.
Oraclehas plummeted 30% this quarter with just four trading days left to go. That puts it on track for the sharpest decline since 2001, when the dot-com bubble was imploding. The timing is brutal—these new CEOs inherited what was supposed to be a generational opportunity when OpenAI agreed to pump more than $300 billion into Oracle's cloud infrastructure.
That was September. Everything felt possible. The stock exploded 36%, hitting an intraday record of $345.72. It felt like Oracle finally had cracked the code on cloud computing, the one place where it'd been left behind by Amazon, Microsoft, and Google.
Then reality hit. In early December, Oracle reported disappointing quarterly results. Worse, it buried a bomb in the earnings call. The newly appointed finance chief Doug Kehring announced that the company would need $50 billion in capital expenditures for fiscal 2026—43% more than what was projected just three months earlier. That's also double what Oracle spent the year before. On top of that massive capex bill, the company is committing to $248 billion in leases to expand cloud capacity. Building all of that costs money. A lot of money.
Investors have grown skeptical about whether Oracle can actually pull this off. The company already went into debt to fund this pivot. In September, Oracle raised $18 billion in a jumbo bond sale, one of the largest tech debt issuances on record. Kehring tried to reassure investors that the company would maintain its investment-grade credit rating, but the market isn't buying it. Credit default swap prices on 's debt are climbing, a sign that investors are hedging their bets on a potential downgrade.
