Oracle shares staged a sharp rebound, climbing nearly 14% across two trading sessions. On Monday alone, ORCL rose 9.64% to close at $156.59, adding to a gain of more than 4% from Friday. D.A. Davidson analyst Gil Luria upgraded the stock from neutral to buy and set a $180 price target, arguing that the selloff had gone too far.
The bounce came after a steep retreat. Oracle has fallen heavily from its $345 peak reached last September, and at one point touched a 52-week low of $118. That leaves investors weighing two very different readings of the stock: a discounted AI infrastructure play, or a company taking on major balance-sheet risk to keep up with demand.
OpenAI contract remains central to the debate
A major source of concern has been Oracle’s relationship with OpenAI. In July 2025, OpenAI signed a data center services agreement with Oracle worth $30 billion per year, while also launching the Stargate project, a buildout plan valued at more than $300 billion. The project calls for 4.5 gigawatts of AI computing infrastructure over five years.
That agreement pushed Oracle Cloud Infrastructure, or OCI, closer to the center of the AI buildout story. It also raised the stakes. If OpenAI fails to support that level of spending over time, the data centers Oracle is building for the contract could become a financial drag rather than a growth engine. Luria pushed back on that concern, saying OpenAI has made visible progress in its business model in recent months, is refocusing on frontier models, is exploring advertising, and holds about $40 billion in cash. He also said OpenAI may raise as much as $100 billion more this quarter.
OCI growth looks strong, but expansion is being financed aggressively
The bullish case rests heavily on OCI. Luria estimates OCI revenue can grow at an annual rate of 71%, and projects that the business could reach $144 billion in annual revenue by fiscal 2030. For a market still centered on AI compute demand, that is a powerful figure.
The cost of pursuing that growth is just as striking. Oracle announced a $45 billion to $50 billion financing plan in 2026 to support OCI expansion, with about half expected to come from equity and convertible debt issuance, and the other half from a one-time investment-grade unsecured bond offering. That comes on top of an existing cumulative debt load of $130 billion. The company also carries $248 billion in operating lease commitments, a figure reported to be up 148% from last August. Those numbers have turned Oracle’s AI push into a debate over leverage as much as growth.
TikTok stake and large customer roster offer support
One asset that may be getting less attention is Oracle’s 15% stake in the U.S. TikTok joint venture, valued at roughly $5 billion to $9 billion. The value is not limited to the holding itself. TikTok is also described as a long-term OCI customer contributing about $1 billion a year in cloud services revenue.
Oracle’s customer list also includes AMD, Meta, NVIDIA, and xAI. Demand is clearly present. The harder question is whether Oracle can build enough capacity fast enough while carrying a large debt burden and massive lease obligations. Luria himself described Oracle’s position as “very dangerous,” a remark that stands out next to a buy rating. The stock has recovered sharply, but the underlying bet remains the same: OCI growth must arrive quickly enough to justify the scale of the financing behind it.