Oracle Stock Drops as AI Backlog Gap Grows and Cloud Rivals Gain Ground

Oracle's (ORCL) stock has dropped as the company faces a widening AI backlog gap, making it harder for the database pioneer to keep pace with cloud rivals . Shares fell 24.8% in the first half of 2026, a decline that closely tracked Microsoft's own AI-infrastructure-linked slide over the same stretch .

The centerpiece of investor concern is Oracle's $300 billion cloud-computing agreement with OpenAI, a five-year contract signed in September 2025 that begins generating revenue in 2027. Bond markets have responded by pricing in a higher risk of default on Oracle's debt as the company borrows heavily to fund the data-center buildout behind the deal, with credit-default swaps on Oracle's bonds reaching record levels . OpenAI's own projections anticipate roughly $650 billion in cumulative cash burn through 2030, against expected revenue of about $280 billion by that same year, a gap that has fueled questions about whether the AI startup can meet obligations it has made not only to Oracle but to other cloud providers building out similar capacity.

Oracle's headline revenue has continued to climb, but that growth has been offset by a surging debt load tied to the AI infrastructure build-out, leaving some investors uneasy about the company's financial flexibility even as its backlog of AI-related contracts grows. As a result, the stock now trades roughly 58% below its peak.

Investors are now watching whether Oracle's remaining performance obligations, swollen in large part by the OpenAI commitment, convert into recognized revenue on schedule as new data centers come online, and whether credit markets stabilize once the buildout matures. A widening AI backlog gap relative to rivals such as Microsoft and Amazon could keep pressure on the stock until Oracle demonstrates it can deliver on its AI infrastructure commitments without further straining its balance sheet.

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