"Of the five hyperscalers-which include Amazon, Google, Microsoft, and Meta-Oracle is the only one with negative free cash flow. Its debt-to-equity ratio has surged to 500 percent, far higher than Amazon's 50 percent and Microsoft's 30 percent, according to JPMorgan. While all five companies have seen their cash-to-assets ratios decline significantly in recent years amid a boom in spending, Oracle's is by far the lowest, JPMorgan found."
"Analysts have also noted that Oracle's data center leases are for much longer than its contracts to sell capacity to OpenAI. Oracle has signed at least five long-term lease agreements for US data centers that will ultimately be used by OpenAI, resulting in $100 billion of off-balance-sheet lease commitments. The sites are at varying levels of construction, with some not expected to break ground until next year."
OpenAI plans to spend $1.4 trillion on AI infrastructure over eight years and has deals with multiple Big Tech providers. Oracle is the only hyperscaler among Amazon, Google, Microsoft and Meta with negative free cash flow; its debt-to-equity ratio has surged to 500% and its cash-to-assets ratio is the lowest, according to JPMorgan. Oracle has signed at least five long-term US data center leases tied to OpenAI, creating roughly $100 billion of off-balance-sheet lease commitments with staggered construction timelines. Leadership shifted from Safra Catz to co-CEOs as Oracle pivots toward AI, and Catz sold $2.5 billion of shares this year.
Read at Ars Technica
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