Oracle’s $300 billion deal with OpenAI has caused its stock to lose $315 billion in market value since September 10, raising concerns about the deal’s viability and potential financial impact on the company. The report highlights that while the market cap loss is significant, it’s a gross simplification to just look at market cap. The loss is equivalent to nearly one General Motors or two Kraft Heinz, showing the extent of the financial strain on Oracle. The deal, announced as an ‘astonishing’ move, has instead led to a sharp decline in investor confidence.
Analysts and investors are questioning the strategic rationale behind the deal, with some suggesting that the high valuation of OpenAI may be unrealistic. The market’s reaction indicates skepticism about the long-term benefits of the partnership. Oracle’s stock performance is being closely monitored to assess the potential ripple effects on the broader technology and financial sectors. The situation underscores the risks associated with large-scale corporate acquisitions and the importance of careful financial planning.