Oracle Corp.’s (NYSE:ORCL) massive data-center push with OpenAI is straining financing markets, highlighting risks in funding the broader AI infrastructure boom.

Debt Limits Challenge Data-Center Financing

Banks, including JP Morgan Chase & Co. (NYSE:JPM), struggled to distribute billions in loans tied to Oracle-leased data centers, as lenders hit exposure limits to a single counterparty, the Wall Street Journal reported on Thursday, citing people familiar with the matter.

The report said Oracle's $300 billion megadeal with OpenAI is pushing Wall Street to its limits, straining investor appetite for the massive debt fueling America's data-center boom.

This concentration risk clogged bank balance sheets and even caused some lenders to avoid projects where Oracle would be the tenant, pushing developers like Crusoe to partner with Microsoft Corp. (NASDAQ:MSFT) instead.

Analysts Warn Of Large Funding Needs

Morgan Stanley credit analysts told the WSJ that Oracle still faces more than $100 billion in additional funding needs through 2027 and early 2028, after planning to raise about $50 billion for 2026.

They cautioned that these requirements could “test the depths of different fixed-income markets,” underscoring the scale of financing needed for AI infrastructure.

Market Risks And Investor Concerns Grow

Lenders have grown cautious due to Oracle’s weaker financial profile compared with peers, including higher debt and cash burn, as well as its reliance on OpenAI, which adds uncertainty.

Despite Oracle stating that projects are progressing on schedule and funding sources are diversified, the broader market faces pressure as AI spending outpaces available capital, with big tech expected to fund only about half of the projected $3 trillion investment through 2028, according to Morgan Stanley.

Execution Remains The Key Risk

Recently, DA Davidson analyst Gil Luria said Oracle is well-positioned in the AI infrastructure race, sitting just behind hyperscalers such as Amazon.com Inc. (NASDAQ:AMZN), Microsoft, and Alphabet Inc. (NASDAQ:GOOGL).

He noted Oracle often serves as an overflow provider but remains much closer to these leaders than smaller cloud players, supported by its software cash flows and an estimated $550 billion backlog that signals strong demand visibility.

However, Luria warned that execution will be critical as Oracle scales its infrastructure.

While earlier concerns about AI demand have eased—supported by large funding commitments like OpenAI’s $122 billion raise and ongoing compute shortages—he said the company’s ability to deliver on this opportunity remains the key risk.

ORCL Price Action: Oracle shares were up 1.52% at $178.96 during premarket trading on Friday, according to Benzinga Pro data.

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