---
title: "Moody's warns Oracle of $300 billion AI order risk, maintains its Baa2 rating"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/257814285.md"
description: "Moody's warns that the $300 billion AI contract signed by Oracle carries multiple risks, but has not adjusted its Baa2 rating. Analysts point out that Oracle's business model relies on commitments from a few AI companies, posing significant counterparty risk. Although Oracle's cloud infrastructure contracts are expected to exceed $500 billion, its debt growth will outpace EBITDA growth, and the net leverage ratio is expected to rise to 4 times, with free cash flow likely remaining negative"
datetime: "2025-09-18T01:07:04.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/257814285.md)
  - [en](https://longbridge.com/en/news/257814285.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/257814285.md)
---

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# Moody's warns Oracle of $300 billion AI order risk, maintains its Baa2 rating

According to the Zhitong Finance APP, the American credit rating agency Moody's has specifically pointed out several risks associated with the approximately $300 billion AI contracts signed by Oracle (ORCL.US), but has not taken any rating action against the software giant (i.e., has not downgraded the rating or adjusted the outlook). Oracle stated this month that the contract amount signed for its cloud infrastructure business is expected to exceed $500 billion, while The Wall Street Journal subsequently cited informed sources stating that OpenAI has signed a roughly five-year, $300 billion computing power procurement contract, which is a major component of Oracle's $500 billion signed amount.

Moody's analysts mentioned the $300 billion contract in their report on Wednesday without specifying the exact client, but emphasized that it highlights the "huge potential" of Oracle's artificial intelligence infrastructure business.

However, analysts also reiterated the risks listed when they downgraded Oracle's rating outlook from "stable" to "negative" in July: Oracle's business model is highly dependent on large commitments from a few AI companies, which poses significant "counterparty risk"—a risk that is particularly critical in project financing, especially when revenue is highly reliant on a single client.

Moody's pointed out that Oracle's data center construction is essentially one of the largest project financing initiatives globally, with its debt growth expected to outpace EBITDA growth. It is anticipated that the net leverage ratio (net debt/EBITDA) may rise to 4 times before achieving EBITDA coverage of debt, and free cash flow is likely to remain negative until reaching the breakeven point.

Currently, Oracle's Moody's issuer rating is Baa2, at the lower end of the investment-grade credit rating range

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