According to market estimates, OpenAI currently accounts for one-third of Oracle's revenue and faces excessively large single customer risk. Meanwhile, as Oracle's free cash flow in 2025 has already shown negative value, there is a high chance that future data center construction will need to be paid through loans or equity fundraising, which has put greater downward pressure on Oracle's stock price. Google recently launched its Gemini Pro 3, and the market was amazed at its model and that it has surpassed OpenAI in artificial intelligence agent, also deepening market concern about the risk of OpenAI failure. The market funds are shifting from being extremely optimistic and buying across the board to only investing in expected winners.
From the current situation of Oracle, the overall market concerns, investors should avoid: (a) the capital expenditure of science and technology enterprises is higher than their free cash flow; (b) the enterprises will have to finance their AI development expenses with large loans or equity fundraising; and (c) companies that are not sure of winning in AI applications. Taking all the above points into consideration, the market is currently more confident in Alphabet (the parent company of Google), while the more worried is Meta.
Oracle's credit default swaps have surged sharply, driving its stock down, and its CDS trajectory can be seen as an indicator that the recent tech stock adjustment has completed or will continue. Will the recent fear ultimately lead to speculative activity in the CDS market, further leading to a downward spiral in technology stocks? I don't think this will be the case at the moment, but the incident has increased the financial cost of future fundraising by science and technology enterprises in the market. The choice of shares invested in science and technology enterprises will be vastly different from the beginning of the year. $甲骨文(ORCL)$
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
