The big question that determines AI trading: How much can OpenAI raise in this round?

Whether OpenAI can successfully complete a new round of massive financing is no longer just a matter of its own survival, but has become a key variable determining the trading logic of the entire AI sector.

Although market rumors suggest that OpenAI's next round of financing could reach as high as $150 billion to $170 billion, if this news is true, it will ensure its cash flow remains until 2030 and is expected to drive a significant rise in the entire AI sector. However, uncertainties in reality are increasing.

According to a previous article by Wall Street Watch, Jensen Huang clarified on January 31 that although the chip giant "will definitely participate" in OpenAI's latest round of financing, the amount is not as large as speculated by the outside world.

On February 2, according to The Wall Street Journal, this funding gap has triggered a chain reaction, directly impacting Oracle, which provides computing power to OpenAI. Oracle had previously included the $300 billion contract signed with OpenAI in its remaining performance obligations (RPO), supporting its stock price surge earlier.

Analysts pointed out that now, with the adjustment of core investors' willingness to invest, investors are beginning to question whether OpenAI has the ability to pay this astronomical fee, and whether Oracle's accounting treatment of fully accounting for it is prudent.

Reports indicate that Oracle is currently facing a dilemma: on one hand, it needs to raise funds through stock issuance to defend its investment-grade credit rating, while on the other hand, it must deal with shareholder dilution concerns after its stock price halved since its peak in September last year.

Huge Uncertainty in Financing Scale

The final scale of OpenAI's current financing is the "deciding factor" for the flow of funds in the AI industry chain.

On February 2, the latest market rumors circulating on social platform X suggest that OpenAI's next round of financing could reach as high as $150 billion to $170 billion, and this optimistic expectation is seen as fuel for whether the entire AI complex can continue to soar.

However, the actual progress on the financing side is full of variables. According to a report by The Wall Street Journal last Friday, due to internal doubts at Nvidia, the letter of intent disclosed by both parties in September—where Nvidia would invest up to $100 billion in OpenAI over several years—has stalled.

Nvidia CEO Jensen Huang clarified on January 31 that when asked whether the investment amount would exceed $100 billion, he clearly stated: "No, no, not at all." Although he confirmed that Nvidia would definitely participate in OpenAI's latest round of financing, the reduction in the investment scale has become a foregone conclusion.

To fill the funding gap, OpenAI is seeking support from other giants. SoftBank invested $22.5 billion in OpenAI last December, raising its stake to 11%, and is currently negotiating for further investment of up to $30 billion. In addition, Amazon is also in contact with OpenAI regarding participation in this round of financing. Considering that OpenAI is estimated to bear commitments of up to $1.4 trillion, its ability to successfully raise massive funds from the aforementioned investors will directly determine its ability to fulfill its obligations.

Oracle's $300 Billion Gamble

The relationship between OpenAI and NVIDIA has long been seen as a microcosm of the "cyclical" nature of AI deals: NVIDIA invests in OpenAI, OpenAI uses the funds to purchase computing power from Oracle, and Oracle then uses this revenue to buy NVIDIA's chips.

The uncertainty surrounding OpenAI's financing poses a significant risk exposure for its core supplier, Oracle. As of November 30, Oracle reported a remaining performance obligation (RPO) of $523 billion, which is approximately nine times its revenue over the past four quarters.

Notably, this includes a $300 billion contract related to OpenAI. In early September last year, Oracle's stock price surged by as much as 36% in a single day after its financial report showed that RPO had more than quadrupled compared to the previous quarter.

Oracle spokesperson Deborah Hellinger stated:

“The deal between NVIDIA and OpenAI has zero impact on our financial relationship with OpenAI. We are confident in OpenAI's ability to raise funds and fulfill its commitments.”

However, according to accounting standards, the $300 billion can only be included in the RPO if management judges that collection is "probable." If OpenAI cannot pay in full or needs other clients to fill the gap, the credibility of the reported figures will be significantly undermined.

This also presents an urgent question for Oracle's management: In the upcoming financial report, will they still consider it "probable" to recover the $300 billion from OpenAI? This judgment will directly affect market confidence.

Oracle's Balance Sheet Defense

Amid concerns about OpenAI's ability to fulfill its obligations and its own debt levels, Oracle is taking action to maintain its financial credibility.

On February 1, Oracle announced plans to issue up to $20 billion in common stock this year, as part of a broader plan to raise $45 billion to $50 billion through equity and debt financing aimed at expanding its cloud infrastructure business.

Reports indicate that while this move will dilute shareholder equity—and occurs after the stock price has fallen by about half from its peak last September—adding equity buffers is seen as a prudent measure in the current climate of uncertainty surrounding AI deals. Oracle is currently borrowing to build data centers, and these investments largely depend on contracts signed with OpenAI.

Market concerns have already manifested in the bond market. Oracle currently has a credit rating of BBB and has been placed on negative watch by S&P and Moody's, facing downgrade risks Some of Oracle's debt (including the 10-year notes issued in September) has recently traded close to junk bond levels, and the cost of its debt default protection has surged.

Risk Warning and Disclaimer

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