Oracle Stock Clings to Support Ahead of Earnings as $124 Billion Debt Load Casts Shadow on AI Boom

Oracle’s breathtaking AI-driven rally has slammed into a wall of macro headwinds and balance-sheet reality. The software giant reports fiscal fourth-quarter results on Wednesday, and investors are bracing for a verdict that will test whether its massive cloud infrastructure buildout can justify the mounting financial leverage.

The stock has shed roughly 13% in the past seven trading sessions, sliding to around €185 by Friday’s close. The trigger was a jolt from the US labour market: May’s nonfarm payrolls came in at 172,000 — double the consensus estimate of 85,000 — sending the Nasdaq tumbling 4.18% on June 5. Futures markets now price in a better-than-60% probability of another rate hike by year-end, a nightmare scenario for richly valued tech names that depend on cheap capital to fund growth.

For Oracle, the selloff has exposed a precarious technical setup. The 200-day moving average sits at exactly €177.25, leaving the stock just 4% above that crucial trendline. A close below that level would be a bearish signal, threatening to accelerate selling pressure. Options traders, who had built heavy bullish bets in early June, are now scrambling as annualised volatility spikes to an extreme 72%.

Should investors sell immediately? Or is it worth buying Oracle?

Behind the anxiety lies a balance sheet that is ballooning faster than the cloud revenue it is meant to support. Long-term debt has surged to $124 billion from $85 billion a year ago, as Oracle pours capital into its OCI cloud infrastructure. The company plans to spend between $45 billion and $50 billion through 2026 on data centres and GPU capacity — a bet that has already won major partners such as OpenAI and Meta. GPU workloads now account for 23% of infrastructure growth, but the cost of that expansion is straining a highly levered structure.

Analysts remain broadly bullish despite the run-up. The consensus price target sits at €215.59, roughly 16% above current levels. Deutsche Bank reiterated its buy rating, while Cantor Fitzgerald projects $284 and BTIG goes as high as $400, pointing to the $553 billion backlog in signed contracts. That backlog represents future revenue that could eventually justify the massive capex, but the market wants to see tangible evidence that the pipeline is converting into cash flow.

The earnings release due after Wednesday’s close is expected to show quarterly revenue of $19.1 billion, a 20% year-on-year jump. Investors will scrutinise whether the AI-driven demand can offset rising capital costs and whether the debt load is starting to crimp margins. The stock has recovered about 11% from its February lows, when fears of AI-related earnings erosion hit Oracle hard, but it remains 34% below its September 2025 peak of €280.70.

Technically, the RSI of 56 is neutral — not oversold — leaving room for either a relief rally or further downside. A double-bottom formation near €137 with a neckline at €171 provides a wider support zone, but the immediate battle lines are drawn around the 200-day moving average. If Wednesday’s numbers disappoint, that €177.25 level will become the fulcrum of the entire trend. If the AI growth story holds up, the pressure on the debt narrative could ease — at least for now.

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