Oracle stock dropped sharply by 5.85% on January 20 as investors reacted to a new bondholder lawsuit alleging the company misled them regarding its aggressive, debt-financed $56 billion AI infrastructure buildout.
- The lawsuit, filed on January 14, 2026, claims Oracle misrepresented the risks associated with the massive debt used to finance the expansion.
- The $56 billion infrastructure investment is directly linked to the company's substantial $300 billion contract with OpenAI.
- The increased leverage has prompted negative outlooks from major rating agencies and caused credit default swap spreads to widen.