Oracle’s credit risk is rising, with market pricing indicating a worsening view of the company’s ability to meet its debt obligations. Early Monday, five-year credit default swaps (CDS) tied to Oracle’s debt increased to roughly 2.03 percentage points per year, based on data from ICE Data Services. The level is described as near an 18-year high. Separate reporting also notes that the cost of insuring Oracle’s existing debt against default reaches a fresh multi-year peak, alongside weakness in the company’s outstanding bonds. The developments are attributed to investor concerns that Oracle’s large investments in artificial intelligence may not generate returns sufficient to support its financial commitments. Taken together, the reports point to a market reassessment of credit risk, reflected in higher CDS spreads and softer bond prices.
Oracle CDS near 18-year high amid concerns over AI-related debt
Oracle’s credit risk is rising, with market pricing indicating a worsening view of the company’s ability to meet its debt obligations. Early Monday, five-year credit default swaps (CDS) tied to Oracle...
- Oracle’s five-year CDS spreads rise to about 2.03 percentage points per year early Monday, near an 18-year high.
- The CDS level is described as a multi-year high for Oracle’s debt protection costs.
- Oracle’s existing bonds sell off alongside the increase in CDS pricing.
- The shift is linked to investor concerns about whether Oracle’s AI investments will pay off.
- ICE Data Services is cited as the source for the CDS measure.
Five-year credit default swaps on the company's debt, a gauge of perceived credit risk, rose to about 2.03 percentage points annually early Monday, according to ICE Data Services.
8 hours agoThe cost of protecting Oracle Corp.’s debt against default reached a fresh multi-year high on Monday while its existing bonds sold off, as doubts grew over whether the company’s massive investments in artificial intelligence will pay off.
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