Oracle Shares Rebound After Denying ‘Delays’

Update (1300ET): Oracle shares are rebounding strongly (and helping the overall market) following a denial of Bloomberg’s earlier report.

Oracle told Reuters there are no delays to sites required for contractual commitments with OpenAI and that all milestones remain on track.

Oracle additionally said site selection and delivery timelines were established in close coordination with OpenAI following execution of agreement and were jointly agreed, according to Reuters.

ORCL shares are back at pre-delay-headline levels but still down on the day thanks to AVGO’s overhang…

* * *

The fecal matter was already starting to strike the rotating object following Broadcom’s disappointing results last night, but the bottom just dropped out of stocks (and crypto) as the following headline hit the Bloomberg screens:

*SOME ORACLE DATA CENTERS FOR OPENAI DELAYED TO 2028 FROM 2027

Bloomberg reports that Oracle has pushed back the completion dates for some of the data centers it’s developing for the artificial intelligence model developer OpenAI to 2028 from 2027, according to people familiar with the work.

The delays are largely due to labor and material shortages, said the people, asking not to be identified discussing private schedules.

Oracle has been working to deliver on a $300 billion contract to supply the computing power necessary to train and run OpenAI’s models since it was inked this summer. Even with the delays, the timelines for the projects in the US remain ambitious for sites that are set to become some of the largest in the world.

“We have ambitious achievable goals for capacity delivery worldwide,” Oracle Co-Chief Executive Officer Clay Magouyrk said on an earnings call this week. The first data center it is developing for OpenAI — in Abilene, Texas — is on track with more than 96,000 Nvidia Corp. chips delivered, he said during the call.

Oracle and OpenAI declined to comment.

Stocks immediately puked with Nasdaq leading the charge…

And even more problematically, these crashes are occurring following record retail buying…

UBS’s US retail market making clients on Thursday had $44 mn of inflows into equity ETFs and some single stocks, outweighing broader outflows across all single stock sectors.

Trading volume in Oracle hit a record level (going back to 2013), with net inflows of $22 mn.

Over the last seven days, RMM clients have net bought $99 mn of Oracle stock, making it the most-bought single stock name in December.

Broadcom also had $22 mn of net buying on Thursday.

The cost of protecting the firm’s debt against default rose 7.4bps to 144.3bps, on track for highest close since 2009, according to ICE Data Services