Oracle Shares Drop After Report Suggests The Company Took $100 Million Loss From Nvidia Chip Rentals

Shares of Oracle (ORCL) dropped in midday trade on Tuesday after a report said the company has lost nearly $100 million from renting out access to Nvidia’s (NVDA) Blackwell chips. 

According to a report by The Information, cited by TheFly, internal documents show Oracle’s cloud business has operated with razor-thin gross profit margins over the past year, significantly lower than many equity analysts had anticipated. The margin pressure reflects the high cost of providing access to Nvidia’s high-performance chips amid competitive pricing and cloud infrastructure expenses.

Oracle’s stock dropped more than 6% after the news. On Stocktwits, retail sentiment around the shares dipped further into ‘bearish’ territory over the past day. Nvidia’s stock, meanwhile, traded flat after gaining nearly 2% in morning trade. Retail sentiment around the AI bellwether was in the ‘neutral’ zone.

The report comes months after Oracle announced a $40 billion agreement to purchase roughly 400,000 of Nvidia’s GB200 AI chips. The chips will power OpenAI’s new data center in Abilene, Texas, part of President Donald Trump’s Stargate initiative — a $500 billion plan to build advanced AI data centers across the U.S. over the next four years.

Under the terms of the deal, Oracle said it would lease computing capacity from the Texas data center to OpenAI through a 15-year agreement, positioning itself as a key infrastructure partner in the AI buildout. The facility, expected to be fully operational by mid-2026, is expected to deliver about 1.2 gigawatts of computing power, making it one of the largest AI data centers in the world.

Oracle’s stock has gained 65% this year and 63% over the past 12 months.

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