Oracle (ORCL-US) Suffers 8-Day 25.2% Drop Amid AI Transition and Debt Pressures

Oracle (ORCL-US) closed lower on Thursday, marking an eighth consecutive trading-day decline as the company faces pressure from a weakening software sector and investor concerns about AI spending. The extended sell-off reflects fears that new AI tools may displace traditional enterprise software, hitting Oracle’s core database business. Oracle is attempting a shift to an AI cloud model akin to Microsoft (MSFT-US), Amazon (AMZN-US), and Alphabet (GOOGL-US), but rising debt and its close ties to OpenAI have kept sentiment cautious. The eight-day decline was the steepest since May 2002, with the stock down 25.2% from its recent high. Negative momentum continued in the software sector, with the iShares Expanded Technology Software ETF (IGV-US) falling 19.4% in the same period, the longest eight-day decline since May 2021, and the worst eight-day performance since March 2020. Since its record high after announcing a $300B cloud partnership with OpenAI in September 2025, Oracle has declined about 60%. The company plans up to $500B in financing through debt and equity in 2026 to meet major client contracts and maintain investment-grade credit ratings. A $250B bond issuance on Monday followed a $180B offering in September. Credit spreads briefly narrowed to about 30 bps after the issuance but widened slightly afterward. According to The Financial Times, banks are seeking to sell $560B in loans tied to Oracle’s data centers, with insurance companies and private credit funds likely buyers.