Oracle is facing increased investor scrutiny after Blue Owl Capital withdrew from talks to finance a planned 1 GW data center in Saline Township, Michigan, a project intended to support OpenAI. Blue Owl had been expected to arrange approximately US$10bn in financing and contribute significant equity. However, discussions reportedly broke down amid tighter lending conditions, concerns about Oracle’s rising debt load, and the risk of construction delays, casting doubt over the project’s viability.
According to a Financial Times report, the financing uncertainty comes as Oracle’s balance sheet is already under pressure. Net debt, including lease obligations, stood at US$105bn at the end of November, and Morgan Stanley forecasts this could rise to US$290bn by 2028. Lease commitments jumped sharply in Q4 2025, increasing from US$100bn to US$248bn. Doubts have now reportedly emerged over OpenAI’s ability to meet those commitments. However, Oracle has refuted FT’s claims.
An Oracle representative told CNBC, “Our development partner, Related Digital, selected the best equity partner from a competitive group of options, which in this instance was not Blue Owl.”
At the center of investor concern is Oracle’s disclosure of Remaining Performance Obligations (RPOs), which represent contracted sales not yet recognized as revenue and depend on future performance. Oracle’s stock rallied in early September after the company reported that RPOs had more than tripled quarter on quarter to US$455bn, later rising to US$523bn as of November 30 — roughly nine times revenue from the past four quarters. Around US$300bn of the RPO increase is widely attributed to a five-year agreement to supply computing capacity to OpenAI, although Oracle has not formally confirmed the customer.
The Wall Street Journal reports that since peaking on September 10, the shares have fallen by 43 percent. Following Blue Owl’s exit from the Michigan project, the stock declined a further 5.40 percent.
Blackstone has held preliminary talks about stepping in but has not committed to a deal. Oracle sought to downplay the setback, telling Reuters, “Our development partner, Related Digital, selected the best equity partner from a competitive group of options, which in this instance was not Blue Owl.”.
OpenAI has not published any financial statements yet, but according to a report by The Wall Street Journal, OpenAI has disclosed US$1.4tn of commitments over eight years and is expected to exceed US$20bn in annualized revenue by year end.
With questions lingering over OpenAI’s finances and NVIDIA’s still-unfinished plans to invest, investors are increasingly skeptical about how much of Oracle’s record RPO balance will convert into cash, and whether expectations around AI infrastructure spending have become overstated.
