Wall Street cools on Oracle’s buildout plans as debt concerns mount: ‘AI sentiment is waning’

Published

2 days ago

November 13, 2025

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Oracle CEO Clay Magouyrk speaks at a Q&A following a tour of the OpenAI data center in Abilene, Texas, U.S., Sept. 23, 2025.

Shelby Tauber | Reuters

Two months ago, Oracle’s stock had its best day since 1992, soaring 36% to a record after the company blew away investors with its forecast for cloud infrastructure revenue.

Since then, the company has lost one-third of its value, more than wiping out those gains. Midway through November, the stock is on pace for its worst month since 2011.

The hype was sparked by Oracle’s strengthening ties to OpenAI. But the mood of late has turned, with investors questioning whether the AI market ran too far, too fast and whether OpenAI can live up to its $300 billion commitment to Oracle over five years.

“AI sentiment is waning,” said Jackson Ader, an analyst at KeyBanc Capital Markets, in an interview.

Ader said that of the big cloud companies in the GPU business, Oracle is expected to generate the least amount of free cash flow. To fund the capex required for Oracle’s business, Ader expects Oracle to turn to more creative financing tools.

Oracle is looking to raise $38 billion in debt sales to help fund its AI buildout, according to sources with knowledge of the matter who asked not to be named because the information is confidential. Bloomberg reported on the planned debt raise last month.

Read more CNBC reporting on AI

The company needs a massive pool of capital as it works with partners to develop and lease data centers across Texas, New Mexico and Wisconsin, while also buying hundreds of thousands of graphics processing units (GPUs) from Nvidia and Advanced Micro Devices to run AI models.

At Oracle’s big annual conference in October, called AI World, tech enthusiasts cheered the company’s cloud infrastructure design as being easily scalable. Investors remained largely enthusiastic at the time, thanks to Oracle’s over $450 billion in signed contracts that hadn’t yet been recognized as revenue.

Skepticism started to hit shortly after the conference. Oracle shares fell 7% on Oct. 17, as investors questioned the company’s ability to reach its lofty outlook announced at its investor day. Oracle said it expected to reach $166 billion in cloud infrastructure revenue in the 2030 fiscal year, up from $18 billion in fiscal 2026.

Oracle’s next quarterly earnings report is expected in mid-December.

Andrew Keches, an analyst at Barclays, said off-balance sheet debt facilities and vendor financing are two options for Oracle. Keches recently downgraded Oracle’s debt, citing the company’s “significant funding needs.”

“We struggle to see an avenue for ORCL’s credit trajectory to improve,” Keches wrote in a note to clients this week.

Oracle Corp Chief Executive Larry Ellison during a launch event at the company’s headquarters in Redwood Shores, California June 10, 2014.

Noah Berger | Reuters

Oracle bulls point to founder Larry Ellison’s long and storied track record. A hedge fund manager who asked to remain anonymous told CNBC that Ellison is “someone you don’t want to bet against.”

And Rishi Jaluria, an analyst at RBC Capital Markets, said in an interview that Oracle could rebuild its momentum in the market with more AI deals. However, Jaluria currently has a hold rating on the stock.

As more investors look to hedge their bets, Oracle’s 5-year credit default swaps have climbed to a 2-year high, a level that’s not alarming but worth watching, credit analysts told CNBC. Credit default swaps are like insurance for investors, with buyers paying for protection in case the borrower can’t repay its debt.

Barclays recommended clients buy Oracle’s 5-year credit default swaps.

Oracle didn’t immediately respond to a request for comment. Last month, CNBC’s David Faber asked Clay Magouyrk, one of Oracle’s two CEOs, whether OpenAI will be able to pay Oracle $60 billion a year. Magouyrk responded, “of course,” while also pointing to OpenAI’s growth prospects and rapid rise in users.

OpenAI CEO Sam Altman said in a post on X last week that the company will top $20 billion in annualized revenue this year and reach hundreds of billions of dollars by 2030.

Gil Luria, an analyst at D.A. Davidson, told CNBC’s “Fast Money” on Wednesday that Oracle represents the “bad behavior in the AI buildout.” He contrasted Oracle with Microsoft, Amazon and Google, which he said all have the available cash and customer demand to justify their rapid expansions.

For Oracle, however, there’s an overreliance on OpenAI, a cash-burning startup, Luria said. Additionally, he said that gross margins for renting out GPUs are dramatically lower than the roughly 80% margin in the company’s core business. Luria has a hold rating on the stock.

In terms of the $100 of stock appreciation that initially followed the last earnings report, “it makes a lot of sense that that’s completely gone away,” Luria said.

WATCH: Oracle and CoreWeave represent ‘bad behavior’ in AI buildout

Oracle and CoreWeave represent 'bad behavior' in the AI buildout, says DA Davidson's Gil Luria

Technology

Google and Disney reach deal to restore ESPN, ABC to YouTube TV

Published

9 hours ago

November 15, 2025

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Google and Disney reach deal to restore ESPN, ABC to YouTube TV

Alphabet and Disney on Friday announced that they’ve reached a deal to restore content from ABC and ESPN onto Google’s YouTube TV.

The deal comes after a two-week standoff between the two companies that started on Oct. 31. The stalemate resulted in numerous live sporting events, including college football games and two Monday Night Football games, being absent from the popular streaming service.

“We’re happy to share that we’ve reached an agreement with Disney that preserves the value of our service for our subscribers and future flexibility in our offers,” YouTube said in a statement. “Subscribers should see channels including ABC, ESPN and FX returning to their service over the course of the day, as well as any recordings that were previously in their Library. We apologize for the disruption and appreciate our subscribers’ patience as we negotiated on their behalf.”

Disney Entertainment’s co-chairs Alan Bergman and Dana Walden, along with ESPN Chairman Jimmy Pitaro, said in a statement that said the agreement reflects “how audiences choose to watch” entertainment.

“We are pleased that our networks have been restored in time for fans to enjoy the many great programming options this weekend, including college football,” they said.

More than 20 Disney-owned channels were removed from YouTube TV, which offered its subscribers $20 credits this week due to the dispute. In addition to ABC and ESPN, other networks that were unavailable included FX, NatGeo, Disney Channel and Freeform.

The main sticking point between the two companies was the rate Disney charges YouTube TV for its networks. Disney’s most valuable channel, ESPN, charges carriage of more than $10 a month per pay-TV subscriber, a higher fee than any other network in the U.S., CNBC previously reported.

It’s not the first conflict this year between YouTube and legacy media.

NBCUniversal content was nearly removed from YouTube TV before the companies reached an agreement in October, preventing shows like “Sunday Night Football” and “America’s Got Talent” from being pulled.

YouTube TV also found itself in a standoff with Fox in August that almost resulted in Fox News, Fox Sports and other Fox channels going dark on the service just before the start of the college football season. The two sides were able to strike a deal to prevent a blackout.

YouTube said it has the option for future program packages with Disney and other partners.

Disney said that access to a selection of live and on-demand programming from ESPN Unlimited, which includes content from ESPN+ and new content on its all-inclusive digital service coming later this year, will be available on YouTube TV to base plan subscribers at no additional cost by the end of 2026.

Here’s the memo that Disney executives sent to employees:

Team,

We’re pleased to share that we’ve reached a new agreement with YouTube TV, and all of our stations and networks are in the process of being restored to the service.

While this was a challenging moment, it ultimately led to a strong outcome for both consumers and for our company, with a deal that recognizes the tremendous value of the high-quality entertainment, sports, and news that fans have come to expect from Disney.

Over the past few years, we’ve led the way in creating innovative deals with key partners –
each one unique, and each designed to recognize the full value of our programming. This new agreement reflects that same creativity and commitment to doing what’s best for both our audiences and our business.

We’re proud of the work that went into this deal and grateful to everyone who helped make it happen — especially Sean Breen, Jimmy Zasowski, and the Platform Distribution team for their tireless commitment throughout this process.

Thank you all for your patience and professionalism over the past several weeks. As you all know, the media landscape continues to evolve quickly, which makes these types of negotiations complex. What hasn’t changed is our focus on the viewer. Our priority is — and will always be — delivering the best experiences and the best value to fans, and we’ll continue working closely with our partners to ensure we’re fulfilling that mission for our audiences.

We’re incredibly optimistic about what’s ahead and grateful to all of you for continuing to set the standard for entertainment around the world.

Alan, Dana & Jimmy

Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC. Versant would become the new parent company of CNBC upon Comcast’s planned spinoff of Versant.

WATCH: Google has a lot more leverage over Disney in their carriage fight: LightShed’s Rich Greenfield

Technology

We’re looking to further trim this drug stock and exit this entertainment giant

Published

17 hours ago

November 14, 2025

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We're looking to further trim this drug stock and exit this entertainment giant

Technology

JPMorgan Chase wins fight with fintech firms over fees to access customer data

Published

18 hours ago

November 14, 2025

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JPMorgan Chase wins fight with fintech firms over fees to access customer data

An exterior view of the new JPMorgan Chase global headquarters building at 270 Park Avenue on Nov. 13, 2025 in New York City.

Angela Weiss | AFP | Getty Images

JPMorgan Chase has secured deals ensuring it will get paid by the fintech firms responsible for nearly all the data requests made by third-party apps connected to customer bank accounts, CNBC has learned.

The bank has signed updated contracts with fintech middlemen that make up more than 95% of the data pulls on its systems, including Plaid, Yodlee, Morningstar and Akoya, according to JPMorgan spokesman Drew Pusateri.

“We’ve come to agreements that will make the open banking ecosystem safer and more sustainable and allow customers to continue reliably and securely accessing their favorite financial products,” Pusateri said in a statement. “The free market worked.”

The milestone is the latest twist in a long-running dispute between traditional banks and the fintech industry over access to customer accounts. For years, middlemen like Plaid paid nothing to tap bank systems when a customer wanted to use a fintech app like Robinhood to draw funds or check balances.

That dynamic appeared to be enshrined in law in late 2024 when the Biden-era Consumer Financial Protection Bureau finalized what is known as the “open-banking rule” requiring banks to share customer data with other financial firms at no cost.

But banks sued to prevent the CFPB rule from taking hold and seemed to gain the upper hand in May after the Trump administration asked a federal court to vacate the rule.

Soon after, JPMorgan — the largest U.S. bank by assets, deposits and branches — reportedly told the middlemen that it would start charging what amounts to hundreds of millions of dollars for access to its customer data.

In response, fintech, crypto and venture capital executives argued that the bank was engaging in “anti-competitive, rent-seeking behavior” that would hurt innovation and consumers’ ability to use popular apps.

After weeks of negotiations between JPMorgan and the middlemen, the bank agreed to lower pricing than it originally proposed, while the fintech middlemen won concessions regarding the servicing of data requests, according to people with knowledge of the talks.

Fintech firms preferred the certainty of locking in data-sharing rates because it is unclear whether the current CFPB, which is in the process of revising the open-banking rule, will favor banks or fintechs, according to a venture capital investor who asked for anonymity to discuss his portfolio companies.

The bank and the fintech firms declined to disclose details about their contracts, including how much the middlemen agreed to pay and how long the deals were in force.

Wider impact

The deals mark a shift in the power dynamic between banks, middlemen and the fintech apps that are increasingly threatening incumbents. More banks are likely to begin charging fintechs for access to their systems, according to industry observers.

“JPMorgan tends to be a trendsetter. They’re sort of the leader of the pack, so it’s fair to expect that the rest of the major banks will follow,” said Brian Shearer, director of competition and regulatory policy at the Vanderbilt Policy Accelerator.

Shearer, who worked at the CFPB under former director Rohit Chopra, said he was worried that the development would create a barrier of entry to nascent startups and ultimately result in higher costs for consumers.

Source: Robinhood

Proponents of the 2024 CFPB rule said it gave consumers control over their financial data and encouraged competition and innovation. Banks including JPMorgan said it exposed them to fraud and unfairly saddled them with the rising costs of maintaining systems increasingly tapped by the middlemen and their clients.

When Plaid’s deal with JPMorgan was announced in September, the companies issued a dual press release emphasizing the continuity it provided for customers.

But the industry group that Plaid is a part of has harshly criticized the development, signaling that while JPMorgan has won a decisive battle, the ongoing skirmish may yet play out in courts and in the public.

“Introducing prohibitive tolls is anti-competitive, anti-innovation, and flies in the face of the plain reading of the law,” said Penny Lee, CEO of the Financial Technology Association, told CNBC in response to the JPMorgan milestone.

“These agreements are not the free market at work, but rather big banks using their market position to capitalize on regulatory uncertainty,” Lee said. “We urge the Trump Administration to uphold the law by maintaining the existing prohibition on data access fees.”