Morgan Stanley Warns Oracle Credit Protection Nearing Record High (yahoo.com)
- Reference: 0180245213
- News link: https://developers.slashdot.org/story/25/11/30/1933216/morgan-stanley-warns-oracle-credit-protection-nearing-record-high
- Source link: https://finance.yahoo.com/news/morgan-stanley-warns-oracle-credit-215223845.html
"And things are only going to get worse in 2026 unless the database giant is able to assuage investor anxiety about a massive artificial intelligence spending spree, according to Morgan Stanley."
> A funding gap, swelling balance sheet and obsolescence risk are just some of the hazards Oracle is facing, according to Lindsay Tyler and David Hamburger, credit analysts at the brokerage.
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> The cost of insuring Oracle's debt against default over the next five years rose to 1.25 percentage point a year on Tuesday, according to ICE Data Services. The price on the five-year credit default swaps is at risk of toppling a record set in 2008 as concerns over the company's borrowing binge to finance its AI ambitions continue to spur heavy hedging by banks and investors, they warned in a note Wednesday. The CDS could break through 1.5 percentage point in the near term and could approach 2 percentage points if communication around its financing strategy remains limited as the new year progresses, the analysts wrote. Oracle CDS hit a record 1.98 percentage point in 2008, ICE Data Services shows...
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> "Over the past two months, it has become more apparent that reported construction loans in the works, for sites where Oracle is the future tenant, may be an even greater driver of hedging of late and going forward," wrote the analysts... Concerns have also started to weigh on Oracle's stock, which the analysts said may incentivize management to outline a financing plan on the upcoming earnings call...
Thanks to Slashdot reader [2]Bruce66423 for sharing the article.
[1] https://finance.yahoo.com/news/morgan-stanley-warns-oracle-credit-215223845.html
[2] https://www.slashdot.org/~Bruce66423
Hail Mary? (Score:2)
Oracle was doomed until they bet everything on AI. Knowing Ellison, there’s a chance he might pull it off. Worse case scenario, Microsoft will acquire them.
On the plus side (Score:5, Insightful)
If the AI-idiots at Oracle overdid it and Oracle dies, there is at least one good outcome from the current AI craze.
Re: (Score:2)
Well, if it does happen, I for one would cheer. 30 years in IT and Oracle has been nothing but a massive headache and cost to every...single...one of my customers.
Re: (Score:3)
I dunno, maybe Broadcomm will buy them and create a vortex of scumbags
There are alternatives (Score:2)
Not saying they are much better but you could transfer to SAP.
Several of the companies I worked for did so around 15 years ago and they still live.
Pin that pops the bubble? (Score:2)
I wonder if this is a flag that the AI bubble is primed and ready for something small to pop it. Curious if CDSs on other tech giants have similar behavior.
how cool is that dude's name (Score:1)
David Hamburger. Bro. Is there anything better. I had to read it 3 times to make sure there wasn't a missing letter somewhere.
Re: (Score:3)
Daughter of Julie Hotdog and Andrew Hoagie.
Too big so fail (Score:2)
Not a typo.
Re: (Score:3)
Oracle has definitely gone downhill for a long time. They should have been sticking to what they really were good at - databases and tools for accessing them.
The downward slope started somewhere around version 8.1 when they decided to add Java to the database.
Re: (Score:2)
I talked to a DB expert at a really large bank about 15 years ago. Apparently, at that time Oracle was already not "good" at databases.
Re: (Score:2)
My experience was like 30 years ago, that's how long ago that they were decent.
Of course any database requires a good DBA and good SQL programmers for optimal results regardless of who has made the database.
Re: (Score:2)
Indeed. Also shows that giants die slowly, unfortunately.
Re: (Score:2)
Just look at IBM, they are still alive. I think that they survives by providing services to banks and some of the Fortune 500 companies.
Microsoft shows all the signs of going the same path. Same with VMware.
Re: Too big so fail (Score:1)
Eeh⦠Microsoft may be a bit of a stretch. Theyâ(TM)ve done a good job of diversifying their customer base in recent decades IMO.
Re: (Score:2)
Well, IBM was basically a zombie 10 years ago. Something will have to stake them to put them out of their misery. Fully agree on Microsoft. Their stuff is only getting worse at this time and was pretty bad before. And their cloud got hacked several times now and had really, really bad vulnerabilities were nobody knows whether they were attacked or not (which makes things worse). They clearly do not have what it takes to survive with the increased need for IT security we have today.
Re: (Score:2)
I think this will turn out to be one giant lawsuit that, even if oracle wins, they'd still have already bet (and lost) the family farm. Blood from a rock.
Re: (Score:2)
Maybe. But above of some level of fail and delusion you do not get access to the good layers anymore. Just look at Trump.
Re: (Score:2)
I did SQL work in the 90s and was always astonished how horrible Oracle was to work with compared to any other DB.
Re: (Score:2)
> Oracle has definitely gone downhill for a long time. They should have been sticking to what they really were good at - databases and tools for accessing them.
> The downward slope started somewhere around version 8.1 when they decided to add Java to the database.
The Oracle codebase is such a unintelligible mess the only way it can be improved is with the assistance of a superhuman AGI.
Re: (Score:1)
Should have failed 30 years ago.
Absolutely horrific database, and worse company.
And that's before you get to the Tiny Orange Mushroom sucking CEO.