S&P downgrades Oracle to BBB – only one notch above junk level

Market signals on an impending AI bust are broader than just Oracle’s woes.

For example, Amazon just had a challenging bond offering where the market is clearly starting to seriously question the ROI on all this money being pumped into AI buildout. That does not bode well at all for AI-only companies without broader cash flow from other businesses. And when the cash dries up this whole thing comes crashing down like a house of cards.

And they terminated 30k employees to achieve this?

https://www.forbes.com/sites/jonmarkman/2026/04/06/oracles-m...

Title is inaccurate. They're BBB- now, not BBB.

Here's hoping this screws up the collateralization of the Paramount takeover deal, and the whole thing unravels.

S&P Global link: https://www.spglobal.com/ratings/en/regulatory/article/-/vie...

Good. F** oracle.

Ed Zitron must be feeling quite validated :-)

This site is shady as hell. You try to decline marketing in their pop-up and it hides maybe a 100 providers and expects you to click each one individually.

Wasn't Tesla rated an F while it was in its hyper growth phase?

Is it me or do none of the AI companies have a "moat" in the Ben Grahmm sense.

I use their services, but I frankly don't care who provides it. I'll chase the chepest/best and have no issue switching from one to another.

The only moat I can see is Microsoft providing its services to companies in its Azure system. Nervous IT departments probably like that it's not leaving their control if Bob in the SAP team spins up some AI crap.

What happens when Oracle can't pay the interest on their loans?

in all our hearts they were always rated CCC

There is AI data center overcapacity already. The KOSPI crashed last week, and it's a leading indicator for the cyclical hardware industry. It already had been that indicator in the 2000 bubble.

I don't know what possessed Ellison to ruin a functioning company, but it will be interesting if he gets a margin call for ORCL's other debt exposures, which are Ellison's massive loans against his ORCL stock.

I can’t wait for Ai bubble to bust already. Maybe it will happen in October/November like the crypto hype.

This is surprising to me. Judging by what appears to be the common sentiment here on HN - which is that AI inference is already profitable, and OpenAI is fairly valued by private markets.

Given that Oracle and Microsoft are major counterparties of OpenAI, it seems odd that their stocks have been performing so poorly recently. Can anyone square this circle for me?

Imagine if their acquisition of TikTok had gone through.