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Oracle Credit Risk Measure Hits Record High on AI-Debt Fears

Caleb Mutua
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Oracle’s credit default swap spreads hit a record 198.18 basis points on March 27, 2026, surpassing the 2008 financial crisis peak, signaling heightened investor concern over its debt sustainability. The 7.2-basis-point daily surge reflects mounting anxiety about Oracle’s $20+ billion debt load amid volatile markets, with oil prices climbing and tech stocks underperforming. Investors are pricing in higher default risk as Oracle’s stock declines and energy costs pressure margins, compounding fears about its ability to service debt obligations long-term. The spike aligns with broader tech sector jitters, as AI-driven spending strains balance sheets while economic uncertainty dampens growth forecasts for enterprise software firms. Analysts warn the trend may accelerate if Oracle’s cloud transition fails to offset debt burdens, potentially triggering credit rating downgrades and higher borrowing costs.
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Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the worldAmericas+1 212 318 2000EMEA+44 20 7330 7500Asia Pacific+65 6212 1000Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the worldAmericas+1 212 318 2000EMEA+44 20 7330 7500Asia Pacific+65 6212 1000Oracle:Oracle signage on the exhibition floor at the Nvidia GTC conference in San Jose, California on March 17. A gauge of Oracle Corp.’s credit risk closed at an all-time high Friday, the latest sign that investors are growing increasingly wary about the technology giant’s heavy debt load amid rising oil prices and falling stock prices.The cost of protecting the company’s debt against default for five years rose 0.072 percentage point, or 7.2 basis points, to 198.18 basis points, according to ICE Data Services. That’s the highest closing level on record, exceeding the previous peak reached in December 2008.

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Source: Bloomberg Technology

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