Oracle just gave back everything, and then some.

The stock plunged about 35% in June, its worst month since September 1990, as investors began questioning the payoff from its massive AI buildout.

The timing makes it sting more. That collapse landed the month right after May's 39.9% surge — Oracle's best month since February 2000.

Up the most in 26 years, then down the most in nearly 36, back to back.

Larry Ellison's Fortune Wiped Out by Half in Less Than a Year

No one has felt the swing like Larry Ellison.

In September 2025, Oracle's co-founder became the second person ever, after Elon Musk, to surpass $400 billion in net worth, briefly surpassing everyone else to sit atop the world as the richest individual on the back of the company's blockbuster cloud deals.

At the end of May, his net worth returned above $300 billion, after Oracle's blowout gains.

Thirty days later, Ellison has lost $100 billion. His net worth is now equal to roughly $202 billion — sixth on the Bloomberg Billionaires Index, behind Dell Technologies founder Michael Dell.

What's Breaking Oracle's AI Rally?

The top line was never the problem.

Oracle's fiscal fourth-quarter revenue rose 21% to $19.2 billion, cloud revenue jumped 47%, and contracted backlog hit a staggering $638 billion, up 363% from a year earlier.

What spooked the market was the price of chasing it.

Oracle's capex is now swallowing the business. In the most recent quarter alone, Oracle spent $16.49 billion building out AI capacity — roughly 86% of everything it took in — with quarterly capital spending up about 82% from a year ago.

For the full fiscal year, that spending jumped 162% to $55.7 billion, overshooting the company's own $50 billion guidance and dragging free cash flow to negative $23.7 billion, from a deficit of just $394 million the year before.

And Wall Street sees no relief: consensus estimates put next year's capex near $92 billion, well above what Oracle just spent.

The balance sheet is doing the rest of the talking.

Oracle carried roughly $130 billion in debt as of late May, and much of that record backlog leans on a single customer, OpenAI — whose own financing needs and reportedly delayed IPO have become a swing factor for the stock.

The strain peaked in the week ending June 26, when Oracle posted its worst week since 2001, down 19%, and revealed it had cut headcount 13% to about 141,000 as it restructured around AI.

Is Oracle a Buy After the Selloff?

Oracle is the sharpest expression of a marketwide anxiety: hyperscaler capex is exploding while free cash flow erodes.

Bank of America's data show the group's forward free cash flow as a share of net income collapsing toward near-zero, even as the rest of the S&P 500 holds around 90%.

Investors who once cheered AI spending are now demanding to see the payoff.

Not everyone is bearish.

According to MarketDash Analyst Ratings, several Wall Street analysts kept a buy rating through the selloff and raised price targets in June, arguing demand signals remain strong even as financing and equity issuance stay the central debate.

History offers a note of caution to the bears, too.

Going back to 1986, Oracle has fallen 30% or more in a single month only eight times, and after the previous seven, the stock usually bounced — a median gain of 16% three months out and 93% a year later, higher roughly two-thirds of the time.

Whether that pattern holds this time depends on the one question the backlog can't yet answer — when the AI revenue actually arrives.

Oracle forward returns after a 30%+ monthly drop