Oracle shares fall as Ellison cancels planned stock sale amid AI sell-off and rate-hike concerns
Oracle stock slipped about 4.5% after co-founder Larry Ellison abandoned a $7.5 billion share-sale plan, while broader AI-sector weakness and expectations of a Federal Reserve rate increase weighed on investors.
Oracle (ORCL) shares dropped roughly 4.5% to $143.47 by late morning trading, following co-founder Larry Ellison's decision to scrap a plan to sell up to 50 million shares worth as much as $7.5 billion. Ellison, who controls about 40% of the company, had announced the sale in June, and analysts expected the reversal to boost the stock. Instead, the news coincided with a broader pullback in artificial-intelligence equities after leaders at Anthropic and OpenAI called for increased regulatory oversight and a slower pace of model development.
The sector-wide sell-off contributed to Oracle's decline despite the positive implication of the halted sale. Investors are also factoring in heightened expectations that the Federal Reserve may raise interest rates at its next meeting, a scenario that could increase the cost of Oracle's expanding AI-related debt and dampen spending on new data-center projects. Recent wholesale-price inflation data and rising oil prices have added to the rate-hike speculation.
By 11:04 a.m. ET, Oracle's stock was down $6.81, trading within a daily range of $141.01 to $145.33 and recording volume of 33.1 million shares.