Here's Why Oracle Stock Slumped in the First Half of 2026 (Hint: Microsoft Was Also Impacted)

Oracle and Microsoft shares each fell 24.8% in the first half of 2026, driven by investor concern over a massive AI infrastructure bet. Oracle's $300 billion deal with OpenAI triggered bond market repricing that reflected heightened default risk, as traders weighed OpenAI's plan to burn $650 billion in cash through 2030 against projected revenue of just $280 billion by the same year.

The negative cash flow math—$370 billion shortfall over the period—spooked fixed income markets first, then equity holders. Both Oracle and Microsoft carry significant OpenAI exposure, making them vulnerable to questions about whether the AI lab can justify its capital-intensive growth trajectory. The bond market's repricing of Oracle credit risk signals that lenders see material execution risk in the OpenAI partnership, a concern now bleeding into equity valuations for both tech giants.

Microsoft's similar decline suggests the market is applying the same OpenAI skepticism across its investor base, despite different deal structures.