Oracle's AI Debt Fears Haven't Stopped Dan Ives From Seeing 40% Upside

Wall Street has spent months worrying that Oracle Corp (NYSE:ORCL) is borrowing too aggressively to fund its AI ambitions. Wedbush analyst Dan Ives thinks the market may be looking at the story backward.

Ives raised his price target on Oracle to $275 from $225 this week, implying more than 40% upside from current levels, arguing the company is becoming one of the AI revolution's most underestimated infrastructure winners.

Oracle AI Debt Fears Grow

Investor concerns around Oracle's balance sheet have intensified as the company ramps up spending on AI data centers and cloud infrastructure tied to customers such as OpenAI. JPMorgan recently estimated that Oracle is tied to roughly $133 billion in debt linked to the AI infrastructure boom.

Credit markets have also started flashing warning signs. Earlier this year, Oracle planned to raise as much as $50 billion to fund AI infrastructure expansion, while credit-default swap levels climbed to their highest levels since the financial crisis.

Dan Ives Sees Oracle As An AI Winner

Ives believes Wall Street is focusing too heavily on the optics of soaring capex and not enough on the demand behind it.

According to Wedbush, Oracle now has roughly $553 billion in remaining performance obligations (RPOs), with Ives arguing the company is "not spending into a vague future" but instead building against already visible and contracted AI demand.

The analyst also pointed to Oracle's growing relationship with OpenAI and its cloud infrastructure positioning as reasons the company could emerge as one of AI's biggest long-term beneficiaries.

The debate now may come down to one question: Is Oracle building an AI bubble — or building the backbone of it?

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