Why Oracle Stock Just Dropped
Key Points
Oracle just declared force majeure on its $165 billion Project Jupiter data center.
The data center needs a lot of power, delivered by gas converted into electricity.
The gas needs a pipeline, which requires environmental permits -- which are being denied.
- 10 stocks we like better than Oracle ›
Oracle (NYSE: ORCL) stock sold off 6.5% through 10:15 a.m. ET Thursday morning as troubles mounted surrounding its proposed "Project Jupiter" data center in New Mexico.
The $165 billion project, which aims to build a gigantic data center in the New Mexican desert, will require 2.45 gigawatts of power. But now, that power supply looks to be at risk.
Missed AI’s "Act 1"? Act 2 Could Be 15x Bigger. Most investors think they missed the AI boat because they didn't buy Nvidia in 2005. But according to our analysts, we’re only at the end of "Act 1"—the R&D phase. "Act 2" is the global rollout. Continue »
Image source: Getty Images.
Oracle's building an AI house of cards
Begin at the beginning: In January 2025, President Donald Trump announced Project Stargate, a massive effort to build AI capacity in the U.S., spearheaded by OpenAI, SoftBank Group, and Oracle. Project Jupiter was to be the keystone of Stargate, with Oracle building the data center, Bloom Energy (NYSE: BE) providing it with power from on-site fuel cells, and Energy Transfer LP (NYSE: ET) supplying those fuel cells with natural gas to convert into electricity.
Problem is, to get the gas to the site, Energy Transfer needs to build a 17-mile gas pipeline -- and it's having trouble getting the environmental permits to do this. Construction of the pipeline was supposed to begin in August 2026; it's been postponed to February 2027 -- and may not meet that target either.
As a result of the delays, Oracle has declared force majeure, seeking to protect itself from obligations to pay the project developer, Blue Owl Capital, for the data center if it's not completed by 2028.
What this means for Oracle
The way all of this has played out, putting Oracle in force majeure -- because of complications arising two levels up the supply chain from its own area of responsibility -- illustrates the risks built into our current AI revolution.
The specific AI company you invest in could do everything right... and still fail because of others' mistakes.
Should you buy stock in Oracle right now?
Before you buy stock in Oracle, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Oracle wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $384,839!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,385,657!*
Now, it’s worth noting Stock Advisor’s total average return is 936% — a market-crushing outperformance compared to 213% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of September 24, 2026.
Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bloom Energy and Oracle. The Motley Fool has a disclosure policy.
Recommended Articles
