Oracle Corp. (ORCL) shares slipped more than 1% on Monday, as investors wrestled with the company's aggressive artificial intelligence infrastructure spending and a fresh warning from a famous short seller. The dip came even as tech stocks led the broader market, with the Nasdaq up 0.21% and the S&P 500 down a slight 0.12%.

AI Data Center Delay Draws Attention

Despite media reports suggesting a six-month delay into 2027 for a New Mexico gas pipeline supporting Project Jupiter, Oracle confirmed on Friday that the data center project remains on schedule with its key partners. The clarification comes as investors scrutinize Oracle's massive AI infrastructure expansion, which has become a double-edged sword: it promises future growth but also demands enormous upfront capital.

Michael Burry Adds To Oracle Short

Adding to the unease, "Big Short" investor Michael Burry disclosed on Aug. 13 that he had added to his short position in Oracle at around $152. Burry has been vocal about his belief that the AI infrastructure boom could eventually lead to excess computing capacity. He sees 2028 as his base case for when "compute becomes too much," but he thinks markets might start pricing in that risk sooner.

The numbers are staggering. Oracle expects capital expenditures of up to $95 billion in fiscal 2027, and future data center lease commitments have climbed to about $260 billion, according to Reuters. Meanwhile, free cash flow has turned negative. Burry argues that these commitments could become harder to justify if AI capacity eventually outstrips demand.

Technical Analysis

On the charts, Oracle is trading about 1.5% below its 50-day simple moving average of $150.61, and a steeper 15.5% below its 200-day SMA of $175.47. However, the stock remains above its 20-day SMA of $136.53. The 50-day SMA has been below the 200-day SMA since a death cross formed in January, keeping the longer-term technical picture bearish until Oracle can reclaim those key levels.

The relative strength index (RSI) sits at 52.07, a neutral reading that suggests the stock is neither overbought nor oversold. Resistance is near $149 and the 50-day SMA, while support is around $135, close to the 20-day SMA.

Earnings And Analyst Outlook

Looking ahead, Oracle's next earnings report is estimated for Sept. 8. Wall Street expects earnings of $1.67 per share, up from $1.47 a year earlier, with revenue projected to rise to $19.13 billion from $14.93 billion. Despite the recent headwinds, analysts remain largely bullish, with a Buy consensus and an average price target of $258.50.

Recent analyst actions show a wide range of views. UBS maintained a Buy rating on Aug. 6 but lowered its price target to $245. CLSA initiated coverage with a Hold rating and a $145 target on July 20. Bernstein maintained an Outperform rating and raised its target to $325 on June 11.

MarketDash Edge Rankings

Oracle's Edge Rankings reveal a sharp split between growth and market performance. Its Growth score is a robust 95.8, but Momentum is just 6.81 and Value stands at 19.03. This combination points to strong growth expectations but weak recent price momentum and a less attractive valuation profile.

Top ETF Exposure

Oracle has a 5.87% weighting in the iShares Expanded Tech-Software Sector ETF (IGV), 5.21% in the First Trust NASDAQ Technology Dividend Index Fund (TDIV), and 4.49% in the FT Vest Technology Dividend Target Income ETF (TDVI). As a result, sizable flows into or out of these ETFs can affect demand for Oracle shares.

ORCL Price Action

Oracle shares were down 1.30% at $148.56 at the time of publication Monday, according to market data.