Oracle stock falls as OpenAI reportedly misses targets; $300B deal in focus

Shares of Oracle Corporation fell about 5% in early premarket trading on Tuesday after a report raised concerns about the growth trajectory of OpenAI, one of its largest customers, casting a shadow over the cloud giant’s long-term revenue visibility.

The decline follows a report by The Wall Street Journal, which said OpenAI has fallen short of internal targets for both user growth and revenue in recent months.

The development is significant for Oracle, which last year announced a massive $300 billion, five-year cloud agreement with the artificial intelligence firm.

The ripples from OpenAI’s reported growth slowdown also reached Tokyo, where SoftBank Group—now a 13% owner of the startup—saw its shares plunge 9.9%.

AI infrastructure provider CoreWeave also fell by 3.5%.

Concerns over OpenAI's growth

According to the report, OpenAI missed its internal goal of reaching 1 billion weekly active users by the end of 2025.

It also fell short of multiple monthly revenue targets earlier this year, amid rising competition in key segments such as coding and enterprise services.

The company has reportedly lost ground to rivals including Anthropic, while its flagship product ChatGPT has seen a decline in market share.

Data cited in the report showed ChatGPT’s share of generative AI web traffic dropped from 86.7% a year earlier to 64.5% in January 2026, while Gemini rose sharply from 5.7% to 21.5%.

Crucially, the report noted that OpenAI’s chief financial officer, Sarah Friar, has expressed concerns internally about the company’s ability to meet future computing contract obligations if revenue growth does not accelerate.

Investor concerns over Oracle exposure

The developments have triggered fresh concerns among investors about Oracle’s exposure to a single, high-profile customer.

The company has been investing heavily in data centre infrastructure to support its AI ambitions, much of it tied to anticipated demand from OpenAI.

Oracle’s financial position has come under increasing scrutiny. The remaining performance obligations surged 325% to $553 billion.

The company is also in the process of raising $50 billion through a combination of debt and equity to fund additional data centre capacity.

These investments are being made ahead of revenue generation from the OpenAI deal, which is expected to begin contributing meaningfully only next year.

Analyst flags structural risks

Some market participants have raised concerns about the sustainability of Oracle’s strategy.

George Noble, a hedge fund veteran and former Fidelity fund manager, warned that the company’s artificial intelligence push could be built on fragile foundations.

“Oracle has been using project financing structures (loans repaid from projected future cash flow) to keep tens of billions more in borrowing off its balance sheet entirely. So when analysts quote Oracle's debt load, they're UNDERSTATING the actual exposure by a meaningful margin,” he said in a post on X.

Noble argued that Oracle’s bullish narrative is heavily dependent on a concentrated bet, particularly the OpenAI contract, and cautioned that delays in related projects and lender skepticism could pose additional risks.

He also suggested that recent earnings performance may be supported by accounting adjustments and cost-cutting measures, warning that the broader narrative could “end HORRIBLY.”

Oracle shares have already declined significantly, falling about 50% from their 52-week high reached last September.

Mixed views among analysts and investors

Despite the concerns, sentiment on the stock remains divided.

According to data from Koyfin, 34 out of 44 analysts currently rate Oracle shares as ‘Buy’ or higher, with an average price target implying roughly 40% upside.

Retail investor sentiment, however, has weakened in recent days.

On Stocktwits, sentiment around Oracle was described as neutral, with some traders expressing caution.

“$ORCL OpenAI news going to drop it hard today,” one user wrote, while another said, “$ORCL embarrassing stock and embarrassed that I bought it.”

Not all analysts share the bearish outlook.

Dan Ives of Wedbush Securities reiterated a positive stance on the stock, assigning an Outperform rating and a $225 price target on April 24.

Ives argued that the market is “fundamentally misinterpreting” Oracle’s heavy capital expenditure as a risk rather than a strategic shift.

He described the company’s transformation into a “foundational infrastructure provider” for the AI economy as being in its early stages.

“The early innings of a significant repositioning” require substantial upfront investment, he said, adding that Oracle has already strengthened its balance sheet by raising $30 billion through investment-grade bonds and preferred stock.

According to Ives, concerns about negative free cash flow are “backward-looking” and fail to account for the scale of future demand embedded in long-term contracts such as the OpenAI deal.

He added that once these partnerships begin to translate into revenue growth, the current weakness in Oracle’s share price could be viewed as a buying opportunity.

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