Oracle Investors Seek Lead Plaintiff in Class Action Lawsuit

Robbins Geller Rudman & Dowd LLP announces opportunity for Oracle investors with substantial losses to lead the class action lawsuit.

Published on Feb. 7, 2026

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Robbins Geller Rudman & Dowd LLP has announced a class action lawsuit against Oracle Corporation (NYSE: ORCL) and certain of its top executives, alleging they made false and/or misleading statements and/or failed to disclose that Oracle's AI infrastructure strategy would result in massive increases in capital expenditures (CapEx) without equivalent, near-term growth in revenue, creating serious risks involving Oracle's debt, credit rating, free cash flow, and ability to fund its projects.

Why it matters

The lawsuit alleges that Oracle's increased spending on AI infrastructure created significant financial risks for the company, which were not properly disclosed to investors. This could have major implications for Oracle's future performance and shareholder value.

The details

The class action lawsuit, captioned Barrows v. Oracle Corporation, No. 26-cv-00127 (D. Del.), alleges that Oracle failed to disclose that its AI infrastructure strategy would result in massive increases in CapEx without equivalent near-term revenue growth. The lawsuit further alleges that Oracle's substantially increased spending created serious risks involving Oracle's debt and credit rating, free cash flow, and ability to fund its projects.

  • On September 24, 2025, S&P Global Ratings warned that OpenAI 'could account for more than a third of total Oracle revenues by fiscal 2028 and even a greater share by fiscal 2030', creating risks.
  • On September 25, 2025, analysts at Rothschild & Co. Redburn initiated coverage of Oracle at 'Sell', warning that Oracle's promises of massive new revenues from its increased AI infrastructure business were 'unlikely to materialize'.
  • On December 10, 2025, Oracle announced its financial results for the second quarter of fiscal year 2026, including revenue growth below analysts' consensus estimate, quarterly CapEx well above analysts' estimates, and negative free cash flow of more than $10 billion.
  • On December 12, 2025, Bloomberg reported that Oracle had 'pushed back the completion dates for some of the data centers it's developing for the artificial intelligence model developer OpenAI to 2028 from 2027' due to 'labor and material shortages'.
  • On December 17, 2025, Financial Times reported that Blue Owl Capital—'the primary [financial] backer for Oracle's largest data centre projects in the US'—had backed out of funding a $10 billion Oracle data center intended to serve OpenAI, as a result of concerns about Oracle's spending commitments and rising debt levels.

The players

Oracle Corporation

An American multinational computer technology corporation that offers products and services that address enterprise information technology environments.

Robbins Geller Rudman & Dowd LLP

A law firm that is one of the world's leading complex class action firms representing plaintiffs in securities fraud and shareholder rights litigation.

S&P Global Ratings

A leading provider of credit ratings, research, and analytics.

Rothschild & Co. Redburn

A financial services firm that initiated coverage of Oracle at 'Sell'.

Blue Owl Capital

The primary financial backer for Oracle's largest data center projects in the US.

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What’s next

The judge in the case will decide on Tuesday whether or not to allow the lead plaintiff to represent the class in the Oracle investor lawsuit.

The takeaway

This case highlights the risks and challenges facing Oracle as it heavily invests in AI infrastructure, with concerns raised about the company's ability to deliver on its promised revenue growth and the potential financial impacts on its debt, credit rating, and cash flow.