Oracle's stock plummeted 5.02% during intraday trading on Thursday, reflecting significant negative pressure on the software giant.

The decline followed a price target reduction by analysts at Citizens, who lowered their target on Oracle to $285 from $342 while maintaining an Outperform rating. This adjustment contributed to negative sentiment around the stock.

Furthermore, Oracle was caught in a broad-based selloff in the software sector, termed "Software-mageddon" by market strategists. The S&P 500 software index tumbled 13% in the past week, driven by growing investor anxiety over the potential disruptive power of artificial intelligence on traditional software business models.

Adding to the pressure, specific concerns about Oracle's financial health emerged. Analysis indicates that the company's significant capital expenditures on AI infrastructure are causing cash flow to turn negative, colliding with its balance sheet. Reports also cite labor shortages and layoff rumors, with credit default swaps reflecting heightened risk perception for the company.