Oracle is facing a proposed shareholder class action that claims the company overstated how quickly its massive investment in artificial intelligence infrastructure would translate into revenue, leaving investors exposed as costs surged and the stock price fell.
The lawsuit, filed in federal court in Delaware, alleges Oracle and several top executives painted an overly optimistic picture of demand for AI data centers while downplaying the financial risks tied to rising capital spending and growing dependence on OpenAI.
Claims of Inflated Growth Expectations
The investor behind the case argues that Oracle repeatedly told the market that booming demand for AI computing would drive rapid sales and profits. At the same time, the company was committing tens of billions of dollars to build data centers and cloud capacity.
According to the complaint, spending climbed far faster than revenue projections.
The suit contends that Oracle increased capital expenditure plans sharply but offered only modest upgrades to its revenue outlook, raising concerns that returns would lag behind investment.
