Cloud computing titan Oracle has seen its shares plummet over 10% in after-hours trading following the firm’s revenues coming short of analyst predictions.

Oracle’s revenue was reported as $16.1bn for the three months before November, while Wall Street predicted the company would achieve $16.2bn in the same time span.

Despite falling short of expectations, the firm saw overall revenue growth of 14%, with Oracle Cloud Infrastructure, its AI service, seeing sales rocket 68% in the period.

Oracle saw its shares peak three months ago, but has since experienced a 40% decrease in value.

The firm signed a contract with OpenAI, which bought $300bn in computing power from the cloud provider over the next five years.

The company’s AI infrastructure is highly sought after as firms look to expand their AI capabilities, requiring vast amounts of compute power and data to enable the advancing tech.

“There are going to be a lot of changes in AI technology over the next few years and we must remain agile in response to those changes,” Oracle CTO and chairman Larry Ellison said in a statement following the share loss.

Oracle’s drop in share price spells worry for the entire AI ecosystem, which has experienced a ‘bubble’ in shares and ‘circular financing’ between top players.

Oracle supplies cloud infrastructure, firms like Nvidia provide AI-enabled chips, and firms like OpenAI provide the foundational models – with other players in the mix, AI infrastructure firms are building a web of megadeals and rising shares. But shareholders are increasingly worried this bubble will pop.

Oracle’s plunge affected wider tech stocks, with the Nasdaq 100 down 1%, and S&P 500 down by 0.78% on the New York Stock Exchange.

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While Oracle performed well overall with a rise in revenue, and the decrease in stock may be down to great expectations, investors remain concerned about the firm racking up debt as it focuses on building more data centres to fuel the AI boom. The firm’s capital expenditure for the 2026 financial year is projected to be 40% higher than previously anticipated, rising fears among investors.

As Oracle focuses its spend on supplying data centres for its AI clients, shareholders are concerned that the firm’s emphasis on the deal may leave it exposed to shortfalls on returns as other cloud players, like Amazon, Microsoft, and Google, make their own deals.

Another aspect affecting the overall AI market is Oracle’s announcement of chip neutrality: Ellison said that while the firm will still rely on Nvidia’s AI-enabled GPUs, the firm must “be prepared and able to deploy whatever chips our customers want to buy.”

While Nvidia has largely cornered the AI chip market, making itself the most valuable company in the world, the firm saw its stock down by 1.58% in pre-market trading.