Oracle refutes claims of OpenAI data center delays
- Last update: 12/13/2025
- 3 min read
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- Business
Dec 12 (Reuters) - Oracle has denied a recent report that claimed it was experiencing delays with the construction of OpenAI-related data centers. The denial comes after concerns arose from investors about the company's debt-driven expansion in the AI infrastructure sector.
Earlier, Bloomberg News reported that Oracle had postponed the completion of certain data centers intended for OpenAI, pushing the target date to 2028one year later than originally planned. The delay was attributed to shortages in labor and materials.
Oracle spokesperson Michael Egbert responded to the report, stating in an email to Reuters, "There have been no delays to any sites required to meet our contractual commitments, and all milestones remain on track." He emphasized that Oracle remains fully aligned with OpenAI and is confident in fulfilling its contractual obligations as well as future expansion goals.
Following the report, Oracle's stock, which had dropped by 3.6%, regained some ground but was still down 2.8% in midday trading. Other companies tied to the AI industry also saw declines, with major chip manufacturers like Nvidia, Advanced Micro Devices, Micron, and Arm Holdings losing between 2% and 4.5% of their market value.
This news followed Oracle's significant stock decline the previous day, after the company posted its biggest drop since January, driven by a weak financial outlook and rising expenditures, particularly in its AI-related investments with OpenAI.
Once a smaller player in the cloud-computing market, Oracle has accelerated its push into AI infrastructure this year, buoyed by a $300 billion deal with OpenAI to build data centers. However, this aggressive expansion has come with considerable borrowing, raising concerns among investors.
Investors have become increasingly wary, spooked by reports of Google gaining an edge in the AI race and Oracle's mounting debt. The cost to insure Oracle's debt against default reached its highest point in at least five years on Thursday, and continued to rise on Friday.
Despite these challenges, Oracle's stock has risen by just 13% this year, having erased a 36% gain from September, when the company reported a massive backlog of over $450 billion, largely linked to its work with OpenAI.
As the AI sector matures, investors are growing more cautious and less willing to reward high spending on AI infrastructure, even as they acknowledge its long-term potential.
OpenAI did not provide an immediate comment on the matter when approached by Reuters.
Following the Bloomberg article, some analysts pointed out that challenges beyond chip shortages are starting to affect data center expansion plans. Bob O'Donnell, Chief Analyst at TECHnalysis Research, noted, "Concerns regarding the ability to build data centers due to construction delays, power availability, and other practical factors are becoming a major consideration. These issues now carry more weight than the anticipated demand for AI capabilities."
O'Donnell further added that market sensitivity to AI-related delays has increased, with investors becoming more focused on the return on investments in the sector. Additionally, Broadcom saw a sharp drop of over 11% on Friday, following concerns that the rising sales of lower-margin AI processors could undermine profitability, raising doubts about the profitability of AI-focused businesses.
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Gavin Porter
Gavin Porter is a reporter focusing on scientific discoveries and technology. He is skilled at translating complex concepts into accessible language for the general audience.
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