Oracle Shares Drop After Report Suggests It Took $100 M Loss From Nvidia Chip Rentals

 

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.

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.

https://stocktwits.com/news-articles/markets/equity/oracle-shares-drop-after-100-million-loss-from-nvidia-chip-rentals/ch6P0rCR3hS