Oracle's stock fell sharply by 5.09% during Thursday's intraday trading session, as investors reacted to multiple negative developments surrounding the company's aggressive artificial intelligence infrastructure investments.

The decline was triggered by a credit rating downgrade from S&P Global, which lowered Oracle's long-term issuer credit rating from BBB to BBB-, placing it just one notch above speculative grade. The rating agency cited Oracle's ballooning capital expenditure projections for FY2027, now estimated at $90-95 billion, driven by AI chip procurement and new data center construction. This spending surge is expected to widen the company's free operating cash flow deficit to approximately $42 billion.

Adding to investor concerns are warnings from AI critics about potential fallout from an OpenAI collapse, with Oracle identified as particularly vulnerable due to its significant exposure to the AI startup. The company also faces growing community backlash against its data center projects, with local opposition mounting over land use and resource concerns. These factors combined to create a perfect storm of negative sentiment around Oracle's massive AI bet, which some analysts warn may be bigger than the company's balance sheet can comfortably support.