Risk assets are under pressure on Thursday despite the Federal Reserve’s rate cut, and Oracle’s failed results pile up alongside the central bank’s hawkish guidance.
bitcoin The leading cryptocurrency by market value is trading close to $90,000, which represents a drop of 2.8% in 24 hours, according to data from CoinDesk. Futures linked to the Wall Street technology index, Nasdaq, are down 0.80%.
Late Wednesday, Oracle released its fiscal second quarter 2026 (Q2 FY26) earnings, covering the period ending Nov. 30, 2025. Total revenue was slightly below consensus, with legacy software revenue down and new license sales particularly weak.
This has once again highlighted the gap between frenetic debt-driven spending on AI infrastructure, promised revenues and the reality of delays in cash flows reaching the coffers.
The Financial Times reported that Oracle’s profits were overshadowed by a $15 billion increase in planned data center spending and a loss in revenue, while its long-term debt rose to $99.6 billion, a 25% increase from a year earlier. Cloud infrastructure revenue came in at $4.1 billion, below expectations, depending further on debt expansion.
The report cites Morgan Stanley forecasting an increase in Oracle’s net debt to around $290 billion by 2028.
Oracle shares fell more than 10% after market hours, dragging down AI shares and offering bearish signals to the crypto market. The price swoon renewed social media focus on Oracle’s five-year credit default, a type of insurance contract that reflects the perceived risk of default.
It has jumped to the highest level since 2022. The increase reflects the significant revaluation of risk, according to the Special Situations bulletin.
“ORCL CDS historically trade between 20 and 40 bps, so 117 bps represents a significant risk reassessment, but not a distress profile,” the newsletter service on X said.
“Oracle’s 5-year CDS chart looks exciting $ORCL until you do the math and realize you’re only pricing in a 1.93% default probability per year and a 9% cumulative default probability over 5 years,” he added.
