New York, Feb 11, 2026, 12:00 EST — Session underway.
- Oracle shares dropped roughly 2.4% by midday, erasing some of Monday’s gains
- Oracle says the U.S. health agency CMS chose its Cloud Infrastructure to handle migration tasks
- Wall Street remains divided over AI-driven spending, funding challenges, and cash-flow pressures, keeping analysts split.
Oracle shares dropped roughly 2.4% to $156 during midday trading Wednesday, retreating after a strong rally earlier this week.
This shift is significant since Oracle has turned into a focal point amid a wider software repricing, with investors scrambling to distinguish genuine demand from pricey expansions. Oracle’s cloud efforts are under the microscope as the industry grapples with concerns that rapid AI advancements might disrupt traditional software frameworks.
JPMorgan strategists argue the recent slide in software stocks reflects “worst-case” disruption fears that probably won’t materialize in the next three to six months, despite ongoing volatility. The S&P 500 software and services index dropped up to 17% over six sessions ending last Thursday, then staged a rebound, the bank noted. 1
The AI arms race is pushing big tech to invest heavily in tangible assets like data centers and chips, and investors are closely watching how these companies finance that spending. Alphabet’s unusual 100-year bond offering this week highlights this trend. Reuters estimates that Alphabet, Microsoft, Amazon, and Meta will collectively spend at least $630 billion on capital expenditures by 2026. 2
Oracle revealed new demand cues on Wednesday, highlighting that the Centers for Medicare & Medicaid Services chose Oracle Cloud Infrastructure to shift some on-premises workloads. “CMS’ programs are vital to the wellbeing of many Americans, a responsibility that demands uncompromising security, reliability, and fiscal stewardship,” said Kim Lynch, Oracle’s executive vice president for Government, Intelligence and Defense. 3
Just a day before, Oracle rolled out new process-manufacturing features in its Fusion Cloud Supply Chain & Manufacturing suite, targeting stricter controls for regulated sectors. “The latest innovations in Oracle Cloud SCM help customers adapt production in real time,” said Derek Gittoes, group vice president of Oracle’s SCM product management. 4
On the Street, D.A. Davidson analyst Gil Luria upgraded Oracle to a buy this week, saying the recent selloff better accounts for the risks tied to Oracle’s growing involvement with OpenAI-driven demand. “We had been quite critical of Oracle and OpenAI before, but now believe the market is pricing those risks more accurately,” Luria noted. 5
Some see it differently. Melius analyst Ben Reitzes cut Oracle to hold, pointing to sluggish cash flow and doubts about converting AI investments into steady profits. He argued the firm’s value fits “more akin to an infrastructure company vs. a software company.” 6
Oracle moved quickly to address funding concerns. On Feb. 1, it announced plans to raise between $45 billion and $50 billion in gross proceeds throughout 2026. This includes an at-the-market program that could sell up to $20 billion in shares gradually, alongside a one-time investment-grade bond issuance set for early in the year. 7
The risk for holders is clear: if demand falters or buildouts drag on, the spending and financing might hit harder than expected, and issuing new shares could dilute current shareholders. Plus, the wider software sector slump means negative news from other players could still rattle Oracle’s stock.
Oracle’s fiscal third-quarter earnings, due around March 9, will be a critical moment for investors. Attention centers on cloud infrastructure growth, capital expenditures, and updates on financing pace. 8
