Oracle Shares Drop 8.83% on Inflation Data

Oracle (ORCL) closed at $130.55, down 8.83%, after hotter-than-expected September Consumer Price Index (CPI) data lifted Treasury yields and revived rate-hike bets. The decline followed a session where the S&P 500 fell 1.08% to 7,721 and the Nasdaq Composite dropped 1.88% to 26,693.

Trading volume for Oracle reached 50.4 million shares, which is about 61% above the three-month average of 31.3 million shares. In the broader enterprise software and cloud infrastructure sector, Salesforce (CRM) closed at $236.00, down 0.84%, while SAP (SAP) finished at $220.40, up 0.30%.

The stock had already faced pressure from financing and execution concerns related to AI cloud expansion, specifically its Project Jupiter data center, which is pending government approvals and faces power logistics costs. Oracle’s spending on AI infrastructure has pushed its debt toward $167 billion, creating a revenue timing gap before OpenAI-related contract revenue begins in 2027. Consequently, Oracle’s credit rating was downgraded to BBB-, one notch above speculative grade.

Elevated inflation data suggests potential federal rate increases, which heightens the risk associated with Oracle’s growing debt load and shrinking free cash flow. This financial strain could force the company to cut its dividend. However, Oracle reported 30% year-over-year revenue growth to $19.3 billion for its fiscal first quarter ended August 31, driven by triple-digit cloud infrastructure gains. Investors are now weighing this momentum against heavier spending, with the next earnings announcement on December 14 serving as a test of whether cloud demand can offset margin pressure and borrowing needs.