By Eric Hastings
Publication Date: 2025-11-30 20:21:00
As stock investors have catapulted Oracle Corporation stock to dizzying new heights in 2024, a distinct silent alarm is sounding on Wall Street’s credit trading desks. The divergence between the company’s soaring stock price and growing concerns about credit default swap (CDS) spreads highlights a fundamental tension in the current tech sector: the immense cost of financing the artificial intelligence revolution. According to a recent research note from Morgan Stanley, the cost of insuring Oracle’s debt against defaults has increased significantly and is approaching levels not seen since the height of the COVID-19 panic in 2020.
The core of Morgan Stanley’s concern lies in the sheer size of the capital required to compete in the generative AI space. Unlike its hyperscaler competitors – Microsoft, Amazon and Google – Oracle has a balance sheet that…
