S&P Global has lowered Oracle’s creditworthiness from BBB to BBB-

https://www.heise.de/en/news/S-P-downgrades-Oracle-to-BBB-only-one-notch-above-junk-level-11363472.html

by gepeto42 • 8 days ago

339 366 8 days ago

heise.de

measurablefunc• 8 days ago

What happens when Oracle can't pay the interest on their loans?

mjcl• 8 days ago

They can sell the software business to broadcom.

dj_axl• 8 days ago

They can rent out their AI infra to The Hyperscalers.

panzagl• 8 days ago

The result would turn into that concentrated evil black lump from Time Bandits

rawgabbit2• 8 days ago

They will ask tax payers for a bailout?

ceejayoz17• 8 days ago

They'll use their purchases of TikTok and Paramount to campaign for a bailout.

llm_nerd3• 8 days ago

Campaign? They're friends of the administration, and the US is firmly in the kleptocracy stage now (the last wrungs of democracy are about to be undone this Thursday evening).

They'll give a bribe to Trump, they'll offer up 5% of the stock to Chairman Trump as the People's Stock now that the US is basically a bizarre oligarchy form of communism, and Oracle will be declared a state enterprise that cannot lose money.

The super rich simply do not fail, and they utterly control every aspect of the US now, exactly as the people apparently wanted.

Americans are in a state of profound denial, but things are about to become very real, very quickly.

kibwen• 8 days ago

Whatever happens, I can assure you that the Ellisons will remain multi-billionaires and the American taxpayer will manage to end up poorer, courtesy of their friend in the White House.

voidfunc• 8 days ago

Their competitors eat them. I would not be surprised to see Oracle's cloud business get absorbed by IBM or Microsoft. Maybe Amazon. The extra DC capacity is valuable to a couple companies right now.

DrProtic• 8 days ago

The lenders will then just report missed payments as revenue on their books.

noncoml• 8 days ago

We will be able to afford RAM and SSD again

hobonation2• 8 days ago

Is it me or do none of the AI companies have a "moat" in the Ben Grahmm sense.

I use their services, but I frankly don't care who provides it. I'll chase the chepest/best and have no issue switching from one to another.

The only moat I can see is Microsoft providing its services to companies in its Azure system. Nervous IT departments probably like that it's not leaving their control if Bob in the SAP team spins up some AI crap.

rawgabbit2• 8 days ago

Uhh. I actively and vocally avoid all things Microsoft. I see Microsoft and I immediately think buggy software with zero security.

esikich• 8 days ago

That's fine, but your inexperience with large companies that are MS's bread and butter doesn't really give you any credibility here. It's the standard for a reason.

dragonwriter5• 8 days ago

Maybe so, but you clearly aren’t a representative sample of corporate decision-makers when it comes to AI (or broader IT) services.

crims0n• 8 days ago

Google has a bit of a Network Effect going... my vehicle got an OTA update to use Gemini. Between that, search, storage, and the YT Premium bundle it was enough to convince me to float a subscription.

ceejayoz17• 8 days ago

my vehicle got an OTA update to use Gemini

G. A. H.

edit: Y'all downvoters want genAI in your cars?!

unreal62• 8 days ago

I use their services, but I frankly don't care who provides it. I'll chase the chepest/best and have no issue switching from one to another.

For the hyperscalers, there is an ease of remaining in the Azure/AWS/GCP fabric from a data provenance perspective, particularly for regulated industries or large, risk-averse enterprises. There's also, of course, a certain network egress tax in most cases.

twoodfin4• 8 days ago

Amazon Bedrock is probably middlemanning an insane amount of token consumption these days for the same reasons.

unreal62• 8 days ago

Is Bedrock a "middleman?" I believe that they run all inference inside of AWS data centers, on their own infrastructure.

Their new endpoint even promises zero operator access [0]

[0] https://aws.amazon.com/blogs/machine-learning/exploring-the-...

anon2913• 8 days ago

Nvidia has a moat. Hardware is hard. No one really competes with them for general compute

therobots9278• 8 days ago

Oh great, good to know the shovel seller has the market cornered.

Now back to the conversation, do any of the gold miners have a moat? Or is this a race to the bottom?

FuriouslyAdrift3• 8 days ago

AMD Instinct is their direct competitor for compute and they are better per dollar, better per watt, and out competing on raw performance.

Only thing holding them back is fab capacity which nVidia keeps buying in bulk to keep them small.

nradov5• 8 days ago

I thought that Nvidia's moat was more in CUDA? Hardware is hard but we've already seen other companies like Google design neural processors with compute efficiency close to Nvidia.

dsl• 8 days ago

General compute is also the worst solution to the problem.

Nvidia's entire business is dependent on Google not being able to make TPUs fast enough.

foobiekr3• 8 days ago

Nvidia's moat is the IBM, Microsoft moat:

I am about to spend $20M, if I buy anything other than Nvidia, and things go wrong, I am going to get blamed, and if things go right I will get no credit. This is why AMD is making no progress outside of very narrow cases and supercomputing.

RansomStark• 8 days ago

I've been thinking for a while, there's not real winners here except the incumbent technology providers. Hear me out: all models are converging towards the same level, gains are getting smaller and harder to come by. The models are commodities nothing more.

This is the leap, nobody really wants to front a model for someone else. If i build an agent, or a service that requires a model, I'd prefer to push the model onto someone else, preferably at no cost. This is a leap as I'm sure right now, most people / businesses are thinking actually i do want to own / front the model.

However, if you accept the leap the easiest way to do this is to make the model the users problem.

From a business point of view that makes things really easy, from a customer point of view, they simply have to accept whatever their vendor of choice is pushing down their throats.

So as a business I build for whatever model Google makes available to android, and whatever model windows bundles, and whatever model Apple bundles, and, excluding the long tail of Chinese vendors and Linux (sorry, its always left out) and that's it, problem solved, and the customer picks up the tab for the tokens

rsoto24• 8 days ago

Step 2. Rising competition causes returns to fall below cost of capital.

https://www.youtube.com/watch?v=2J2Fb1bBufA

selicos• 8 days ago

The adoption of standards like skills and agent setup helps a ton. Nobody wants to be locked into an AI vendor like with cloud systems in general. And companies can't hold on to the #1 spot across multiple areas for very long, so users are even more motivated to move their process and stack between coding tools and AI companies behind them like Claude code.

Vendor lock in cannot happen, or you're bankrupt.

nradov5• 8 days ago

The moat is shifting from technology to access to proprietary training data. It doesn't matter how good your LLM platform is if you don't have good data to feed the training run. Public Internet data and published media is already mined out. Now the frontier LLM vendors have shifted to licensing proprietary data that's locked up behind corporate firewalls, and even hiring human domain experts specifically to create new training content in target verticals. You'll see the effects of this next year, although it might not be obvious to those who mostly only use LLMs for coding tasks in popular programming languages for which there was already a lot of training data.

lelanthran16• 8 days ago

Now the frontier LLM vendors have shifted to licensing proprietary data that's locked up behind corporate firewalls, and even hiring human domain experts specifically to create new training content in target verticals.

That's a losing proposition for any token provider - it's expensive and slow, and when you're done everyone with money to rent a last-gen H100 is going to distill your "closed" model anyway.

boron10062• 8 days ago

I think anthropic with its enterprise strategy and google with its integration in everything have a bit of a moat.

But I switched from ChatGPT to Claude 3 months ago because my account was down for like 6 hours. I haven’t used it since. It’s too easy to switch away from chatbots on a whim. There is no moat for that.

lelanthran16• 8 days ago

I think anthropic with its enterprise strategy and google with its integration in everything have a bit of a moat.

But... Anthropic doesn't have a moat. It's clear at this point that SOTA models are not a moat, and Opus 4.6-level (or GLM 5.2) is sufficient.

Google, though... they own the entire vertical, from the semiconductors to the end-user software. They may have a moat.

rsoto24• 8 days ago

google might have tons of integration. But if it invested too heavily into AI then it will also suffer when increased competition causes returns to fall:

https://www.youtube.com/watch?v=2J2Fb1bBufA

solatic• 8 days ago

AWS and Google at least own their own hardware (Trainium and TPUs, respectively). It's a moat in the sense that designing, building, and deploying your own chips at scale is quite a feat and not easily replicated. The vertical integration will allow them to continue to be profitable once the models get good enough and competitors' prices race to the bottom. Google has Gemini; AWS may not deploy its own models (yet?), but that's not necessarily a losing position, as long as the market is able to run models sourced elsewhere on Trainium and the price is right.

amlib2• 8 days ago

Isn't specialized hardware also a big risk? GPUs are more amenable to any big changes that may happen in the next 5, 10 years of AI research. Maybe we won't even be talking about LLMs anymore. Maybe matrix multiplication won't even be the main primitive.

rsoto24• 8 days ago

That's exactly what giant train corporations thought. "We own all the railways, we've squashed the competition"

and they STILL went out of business because they over-estimated the demand for their shitty rails they built to the middle of nowhere. Same with "AI."

https://www.youtube.com/watch?v=2J2Fb1bBufA

foobiekr3• 8 days ago

Their "own" as in built by Marvell and Broadcom. Especially Trainium but also TPU4.

mikeweiss• 8 days ago

You may not care, but a lot of people I know care what brand chat bot they use personally,. usually it's tied to trust and reputation more than anything else. People are fickle.

pseudosavant• 8 days ago

I've found that there is value in consuming AI services from your existing cloud provider. Customers and auditors have less of an issue with "we use AI services from AWS/Azure/GCP" if the data was already in those clouds and it doesn't expand the risks of data being breached, or trained on, by some other provider.

When you are already trusting 100% of your data, and computing on that data, to someone like AWS, it doesn't meaningfully increase risk to use an additional service, even if it is an AI service.

pgn674• 8 days ago

Title is inaccurate. They're BBB- now, not BBB.

wyrdcurt• 8 days ago

True. The linked article's title says that. I wonder if that was a typo by the OP or one of those HN quirks where the title was automatically changed when it shouldn't have been.

abirch• 8 days ago

I think there's an errant space in between the BBB and the - but yes, the title is wrong with that space

dmurvihill• 8 days ago

I bet the author submitted "to BBB-, one above junk" and an ignorant editor turned the minus into an em dash

fuzzfactor• 8 days ago

I would say that the more a company still has plenty of old-fashioned intangible positive corporate goodwill, the bigger the notch.

Wouldn't want to be negative at a time like this.

tflinton• 8 days ago

[flagged]

groundzeros2015• 8 days ago

Bond rating is about financial solvency, not goodness.

Zsfe510asG• 8 days ago

There is AI data center overcapacity already. The KOSPI crashed last week, and it's a leading indicator for the cyclical hardware industry. It already had been that indicator in the 2000 bubble.

I don't know what possessed Ellison to ruin a functioning company, but it will be interesting if he gets a margin call for ORCL's other debt exposures, which are Ellison's massive loans against his ORCL stock.

therobots9278• 8 days ago

Well it seems like he bought the “AGI is 2 years away” line. As did… pretty much everyone in Silicon Valley.

SirFatty• 8 days ago

yeah.. https://ai-2027.com/

AlexandrB2• 8 days ago

The ability of Silicon Valley to hype itself up into a frenzy is unparalleled. Apparently nothing was learned from "blockchain for everything" and "we're going to live in the metaverse".

surgical_fire6• 8 days ago

Another evidence that rich assholes are not necessarily very intelligent.

They are just rich. And also assholes.

lelanthran16• 8 days ago

I don't know what possessed Ellison to ruin a functioning company,

Same thing that drives all these execs of large companies - naked greed!

"If only we can fire all workers, imagine how profitable we'll be!"

They are attempting to set civilisation on fire with the intention of being on top when they no longer need humans.

tmp104232884422• 8 days ago

The KOSPI went up already 125% in the past year, so some sort of correction was inevitable, even if the underlying companies are healthy. The crash has been exacerbated by South Koreans levering up heavily in the past few months and now getting wiped out.

therobots9278• 8 days ago

This is surprising to me. Judging by what appears to be the common sentiment here on HN - which is that AI inference is already profitable, and OpenAI is fairly valued by private markets.

Given that Oracle and Microsoft are major counterparties of OpenAI, it seems odd that their stocks have been performing so poorly recently. Can anyone square this circle for me?

jimbokun2• 8 days ago

HN has been split on this question, with both pro and con strongly and vigorously argued.

darkwi11ow• 8 days ago

Inference might be profitable, but it does not mean the profits of AI datacenters will rise in future. Open weight models and local AI already put the pressure on the AI datacenter profit margins, and local AI is set to become much more efficient in the future.

cmiles88• 8 days ago

The general fallacy of the “but inference is profitable” argument is that it tends to ignore all the costs of building and training the model. Given the fact that 1) that’s not trivial, and 2) the arms race underway means one can’t stop training, then it ruins the financial picture.

It’s like saying a new apartment building is “profitable” because the monthly income covers the monthly running costs, but ignoring the giant mortgage that covers the cost of building the building. That thinking is a good way to go bankrupt in real estate and a good way to go bankrupt in AI.

an0malous• 8 days ago

The general fallacy of the “but inference is profitable” argument is that it tends to ignore all the costs of building and training the model. Given the fact that 1) that’s not trivial, and 2) the arms race underway means one can’t stop training, then it ruins the financial picture.

Or that it’s all hearsay and no one has released financials yet?

CamperBob23• 8 days ago

If the company who holds the mortgage wanted to own the building, they would have just bought it themselves. They don't, for whatever reason, so to some extent they have an incentive to help their customer succeed.

That's why it's so hard to get a residential mortgage, for example. It's more of a partnership, with more mutual vulnerability, than most people think. Same thing seems to be true here.

lbrito• 8 days ago

I think those are just the loud minority. I wouldn't be surprised if they're like 20-30% if a poll were made here

twoodfin4• 8 days ago

Good question.

Given what happened with xAI’s excess capacity lease to Anthropic, and Meta’s noises about doing the same, seems likely that the demand for inference will continue to slope upwards for a while. If I’m Oracle, I’m not worried about being able to utilize the data centers I’ve built for some price, almost certainly a profitable one.

I’m guessing, though, that Oracle made their capital investments on assumptions of a higher price & return. Possibly because it wasn’t clear when these decisions were made how much competition OpenAI would have at the frontier.

I don’t think this math is all that hard. Capital markets have everything they need to start to figure it out, most especially a year or two of history to project forward.

38484848943• 8 days ago

That sentiment only seems to pop up in Anthropic / OAI threads, wonder why

chasd005• 8 days ago

it is isn't enough for inference to be profitable, the whole organization has to be profitable enough to keep investors from looking elsewhere for a return.

therobots9278• 8 days ago

I agree but I don’t want to concede that point. There’s no evidence that inference is profitable which makes the rest of the conversation a non-starter.

When dealing with sophists you have to pin them down on specific points and prevent them from shifting the conversation.

dralley• 8 days ago

Here's hoping this screws up the collateralization of the Paramount takeover deal, and the whole thing unravels.

segmondy• 8 days ago

I hope not, that would further weigh them down.

harmmonica• 8 days ago

I looked this up yesterday triggered by their threat to move the combined company out of CA. Oracle’s stock price, at least, which is way off its 52-week high, is about the same as it was at the time the WBD deal was announced.

What does that tell me? Just one of many things about the prospects of the deal still happening. That one in particular says to me they won’t be deterred. Bond rating may suggest the opposite. Lots more complexity than those two things but “fun” to speculate.

chasil• 8 days ago

And they terminated 30k employees to achieve this?

https://www.forbes.com/sites/jonmarkman/2026/04/06/oracles-m...

LaurensBER• 8 days ago

When we tried to do a pilot with their cloud we couldn't even sign-up. None of the corporate credit cards were accepted.

In addition to that the form basically only worked in Edge. We emailed support, they changed something on the backend. It still did not work. We gave up.

In retrospective that was a very clear warning sign that their priorities were misguided. I'm glad we did not waste any further time and effort on them.

csomar• 8 days ago

Good to know it's not only problematic on the free tier. I wanted to sign up to get the free credits but couldn't finish the setup. I tried again now and it accepted/charged my card ($1 verification test) but then after the account was created it said I need a credit card?

Ancalagon3• 8 days ago

They couldn't integrate a payment provider and expect to build out the data centers for AGI?

Uh, good luck guys.

Analemma_• 8 days ago

Oracle Cloud sometimes feels like an elaborate prank that I'm not in on. I know people and companies on AWS (obviously), Azure, Google Cloud, Hetzner, CloudFlare's various PaaS offerings, etc., but I can't name a single thing running on Oracle Cloud. Somebody out there is clearly using but I'll be damned if I know who it is.

UltraSane4• 8 days ago

That is crazy. One of the main rules of business is to always make it as easy as possible for customers to give you money.

Aurornis2• 8 days ago

I signed up for Oracle Cloud. I couldn’t get any of the free trial options to work due to capacity limits. I couldn’t get my payment method added so I could pay for real servers.

Then they terminated my free trial early with no explanation. I tried to add a payment method again and it didn’t work.

It turned into a bigger joke when Oracle sales people started emailing me to ask how my trial was going. They must have been given a list of email addresses and no information about the accounts. I would ask them for help getting my account unlocked or adding a payment method, they would send me emails for a couple weeks saying they were looking into it, then they’d ghost me.

Then a month later a new sales rep would email me and start the process over.

I checked Reddit and there were dozens of stories with the same experience.

jorl17• 8 days ago

Every couple of years I try Oracle Cloud and nothing ever really works. It feels like it was built by people who literally cannot see the final result of what they work on. Signing up, adding cards, clicking links in e-mails -- nothing worked! Nothing has ever reliably worked!

I hate Oracle with a passion for everything they've done throughout the years, I hope they burn in hell. Of course I don't want that for most of the people working there, but those making the decisions? Kindly go the way of your cloud and vanish from relevance.

cmiles88• 8 days ago

Market signals on an impending AI bust are broader than just Oracle’s woes.

For example, Amazon just had a challenging bond offering where the market is clearly starting to seriously question the ROI on all this money being pumped into AI buildout. That does not bode well at all for AI-only companies without broader cash flow from other businesses. And when the cash dries up this whole thing comes crashing down like a house of cards.

pocksuppet3• 8 days ago

IMHO these signals have more to do with the market than AI. They aren't finding AI to be have less ROI than before - they are requiring higher ROI than before, because there is less money remaining to be invested.

Managing the total amount of money so that investment bubbles peter out before they get excessively big is supposed to be the central bank's job.

cmiles88• 8 days ago

The bond market is measuring the risk of repayment though not the success ROI of the dollars invested by the company (that impacts the stock price but not so much the bond price). The bond markets are hiccuping on AI because there’s growing concern that these loans simply won’t get repaid.

toomuchtodo• 8 days ago

Kinda cool to be at a point in the hype cycle where the capital markets are almost exhausted due a to a speculative bubble, pushing up yield demand. Move over tulip mania.

https://en.wikipedia.org/wiki/Tulip_mania

No of course there isn't enough capital for all of this. Having said that, there is enough capital to do this for a at least a little while longer. -- Gil Luria (Managing Director and Analyst at D.A. Davidson)

lelanthran16• 8 days ago

They aren't finding AI to be have less ROI than before - they are requiring higher ROI than before, because there is less money remaining.

What ROI? There was no return, and there currently isn't any return on investment, because those companies did not exit yet!

The exit plan is to offload overpriced shares, that they paid billions for, onto the public market. If they don't IPO, those investors get nothing.

jstanley• 8 days ago

there is less money remaining.

In what sense?

This may be related to the commonly-held fallacy of "cash on the sidelines". Cash is always on the sidelines. Cash is not created or destroyed by buying and selling stocks or bonds. Cash is simply handed from one party to another, but the cash has to be held by somebody.

qeternity• 8 days ago

is supposed to be the central bank's job.

What? No it's not, and never has been.

Without even getting into the practical vs. theoretical of Fed dual mandate (funding deficits), even the most uncharitable take on modern CBs wouldn't suggest this.

s1artibartfast5• 8 days ago

Challening bond offerings and higher yields can be a funtion of supply.

Downgrade of credit worthiness is different. That depends on how leveraged the company is

jagged-chisel• 8 days ago

I was at the ophthalmologist for the second time in two weeks - my new prescription wasn't quite right, new lenses should be here this week.

All that to say: I had to move my focus around a bit and re-read "...pumped into AI buildout." several times, because I thought I was reading Ed Zitron :D

richwater• 8 days ago

Hi there, how do you know Amazon's bond offering was "challenging"? Curious to learn more. Thank you.

cmiles88• 8 days ago

A bunch of press on this today you can look up. Demand on the offering was much lower than expected and what materialized in prior rounds. Amazon had to sweeten the deal to get the money loaned.

ifwinterco• 8 days ago

Low bid to cover ratio - it's rare for bond auctions to out and out fail (that would be fairly disastrous), but you can have an auction where they successfully sell all the bonds they were trying to sell but with much less demand than they were hoping for.

That's not a good sign and it's a blatant red flag for the market

lelanthran16• 8 days ago

Market signals on an impending AI bust are broader than just Oracle’s woes.

It's worse than that - I believe that Oracle is one of the (many) companies right now that, if their AI experimentation fails, will stop the music, and everyone will be running for a chair.

Oracle is one of a few foundational components in the circular-investing group of AI companies. If they fail to make their commitments they're the first domino to fall.

someuser545413• 8 days ago

What's the best way to hedge against this, considering many of us have significant savings in the market?

A few puts on SPY dated a year or two out?

echelon2• 8 days ago

Everyone in the tech and media world is dead set on this being a bubble.

Yet, even now, Fable is able to do the work of 4-5 engineers when used by a single senior engineer. Teams can and will shrink.

Look at all the production and advertising companies switching over to Seedance. I know ad firms bidding 1/4th their typical contract price (pharma, P&G, etc.) and winning contract after contract.

This isn't dotcom "dark fiber" before demand. The demand is here now, big legacy firms are just struggling with deploying it. Nimble small teams are making a killing.

kazinator4• 8 days ago

It would be great if they open sourced the proprietary bits in the VirtualBox suite before that.

notatoad• 8 days ago

My understanding of the ai circular financing racket is that not everyone will be running for a chair.

Nvidia owns all the chairs, and they’re letting other companies pretend to for a while, but if it all falls apart the backstop to the collapse will be nvidia.

dibbsonline• 8 days ago

Takes a lot of IaaS to support the GPUs and workflows, all of that kit is immediately re-useable as general purpose compute to exit the commercial DCs they operate out of today.

Much of their current debt fuelled expansion isn't singular to AI. The circular narrative ignores this.

seanmcdirmid• 8 days ago

Oracle has been a toxic tech for a long time (along with IBM). I don't think anyone is putting it in the same bucket of modern tech companies, let alone AI companies.

Frankly, their forays into dubious financial engineering and investments are expected at this point.

solumunus3• 8 days ago

And let’s be honest there’s absolutely no chance Oracle will be successful here right?

lenkite• 7 days ago

Can someone explain this circular-investing domino ? If Oracle falls, who else would fall ?

Ancalagon3• 8 days ago

And none of the major model makers (not counting SpaceX) have IPO'd yet

xnx• 8 days ago

Google (and to a much lesser degree, Facebook)

Maxatar• 8 days ago

Is Gemini really that unpopular?

dragonwriter5• 8 days ago

Pretty sure Google fits any definition of major model maker that SpaceX does, and had their IPO long before SpaceX.

Meta and Microsoft both are also significant makers of GenAI models that are public, though neither has a big tentpole LLM line that they sell access.to commercially like OpenAI, Anthropic. Google, SpaceX, which I infer might be what you mean by major model maker.

semiquaver• 8 days ago

Nothing says “full of shit” like someone saying “market is signaling an impending X”. Why not make a huge levered bet and get wildly rich if you think so?

xienze• 8 days ago

Knowing "what" will happen is different from knowing "when" it will happen.

tptacek• 8 days ago

This is a pretty Oracle-specific situation, isn't it? They bet the company on an AI infrastructure buildout and levered hard to do it. Google, Amazon, and Microsoft aren't in comparable situations. Oracle is transforming itself into a value-added CoreWeave (not just in terms of product packaging but also the financial structure of the company), in a way the other hyperscalers aren't.

This story has been playing out for years now, and reads to me like the market simply recognizing that Oracle is not in the same business as it once was. It could succeed, wildly, at this new thing, but its risk isn't going to be valued based on the business it was 10 years ago.

echelon2• 8 days ago

Fable and Seedance are wildly good products, and they're creating lots of opportunity for disruption.

Oracle is in a weird shape.

Aurornis2• 8 days ago

And when the cash dries up this whole thing comes crashing down like a house of cards.

The problem in this market is that too many players are trying to play a winner-takes-all angle.

For the companies that pull it off, it could be very lucrative.

In a real market we’ll get a couple of big winners rather than one, but there isn’t enough room for all of these moonshot efforts to land.

I don’t see the whole thing coming crashing down, but I do see a consolidation coming that leaves some companies in a very bad state.

duxup2• 8 days ago

Can the existing AI leaders sort of turtle up / cut research and … be profitable with what they have?

AbstractH24• 7 days ago

Its easy to identify the problem its hard to time it or optimize for it.

Apocryphon2• 8 days ago

Imagine if their acquisition of TikTok had gone through.

pocksuppet3• 8 days ago

Wait, they don't own US TikTok? Who does?

Apocryphon2• 8 days ago

I thought it was only 15% of the company.

thewebguyd• 8 days ago

TikTok USDS Join Ventures LLC owns 80%, ByteDance still owns a minority stake.

Oracle holds 15% & is the hosting provider, Silver Lake has a stake, MGX (UAE state backed firm) owns some as well.

But Oracle still manages the content recommendation algorithm and the infrastructure so I'd argue they still have the biggest impact on the platform.

xyst• 8 days ago

I can’t wait for Ai bubble to bust already. Maybe it will happen in October/November like the crypto hype.

Reptur• 8 days ago

This site is shady as hell. You try to decline marketing in their pop-up and it hides maybe a 100 providers and expects you to click each one individually.

rf15• 8 days ago

This shady site is an established business created in 1949.[1]

[1] https://en.wikipedia.org/wiki/Heise_Group

thatjoeoverthr• 8 days ago

So are all the other shady websites.

mangogogo• 7 days ago

a site can be annoying or shady regardless of who it's from. i was personally very turned off by the heavy-handed popup and resorted to reading a recently archived version of the link.

iririririr• 2 minutes ago

popup? what's this? 1994? who still browses without an adblocker?

chaitanyya• 8 days ago

in all our hearts they were always rated CCC

lelanthran16• 8 days ago

Ed Zitron must be feeling quite validated :-)

bpavuk3• 8 days ago

he is correct on most counts and for the rest I lack the competence to vouch for or denounce his research. a rare sight!

surgical_fire6• 8 days ago

I like his work.

I think he is wrong when he says AI is useless. I agree that it's far from being as useful as assholes like Amodei claim it is, but it clearly has use cases.

Then again, that is the weak part of Zitron's argument, and laughably the only thing his critics like to engage.

When he brings up the bonkers economics of AI, and how absolutely unsustainable it is, his arguments are very solid. I am still to see one good counter to him there. It's not like he lacks haters who could try.

qurren• 8 days ago

Wasn't Tesla rated an F while it was in its hyper growth phase?

zaik• 8 days ago

Most sensible Tesla valuation.

teepo• 8 days ago

S&P Global link: https://www.spglobal.com/ratings/en/regulatory/article/-/vie...

steve19772• 8 days ago

Oh no.

Anyway...

ratelimitsteve• 8 days ago

people have been burning investor money for heat in re: AI for a few years now and it's starting to get chilly...

minraws• 8 days ago

It's still a bunch too high should be below junk imho

u1hcw9nx• 8 days ago

Oracle LFCF (ttm): -24.54B

Levered free cash flow (LFCF) is the cash remaining after a company has paid its debts and operational costs. Oracle has 167.43B debt. $43 billion in last fiscal year.

Google, Meta, Microsoft, Amazon will be fine if AI bubble bursts. Oracle will be among first to go down in flames after OpenAI.

kittikitti• 8 days ago

“We don’t mind losing customers” Former Oracle CEO on their unwavering support for Israel.

rcbdev• 8 days ago

“We don’t mind losing customers” Former Oracle CEO on their unwavering support for Israel.

They'll be fine.

SwellJoe• 8 days ago

Good riddance. Maybe if the trash-tier AI plays get knocked out I'll be able to buy memory and GPUs again.

pedrosuave• 8 days ago

Is just wild to me people thinking ai is tulip fever or a massive bubble when every part of my life ai is entering. Even these forums 35 percent of posts are ai or vibe code related. At work (medical field) ai is replacing scribes and it can read an ecg better than your average doc. TSMC and chip companies are using in their pipelines. Pharm and bio companies are using. Archeologists are using to decode scrolls and find new petroglyphs. Education and tutoring will never be the same ... kids got lucky having YouTube but now you basically have your private tutor. Vfx is being infiltrated. Computer security. I look around and robots are delivering my food and waymo is picking me up. I turn on the news and in the last couple months Ukraine is now using ai targeting on their drones in addition to the machine vision. My apartment complex recently had a renovations and paint job and my landlord showed me how they designed the color scheme and renovations with chat gpt before getting a crew to do the work. I made an app for my family photography contest for the first time something I never dreamed of at 40 years old with no programming knowledge. I updated my framer website faster than I ever have with Ai.

So please explain to me how this is a bubble especially considering that most of these feature are based on llm and not even on how we primarily interact with the world ...visually. the bubble will happen after I can turn on a webcam and the program watches me draw or do a golf swing and gives me realtime tips or i put on some ar glasses and it coaches me at work .

The amount of compute needed for graphics real time info is astronomical compared to llm . We are so far from the top of a bubble. The problem with ai in my opinion invest with the mindset that what goes up must come down and if it went up big it must come down hard soon. That's not a rule of nature or anything somethings are bedrock and keep going up. I'm sure when electricity was invented and reached every house maybe some people thought the bubble was over but we keep needing more and more. There is zero evidence now that we will need less ai compute.

I think it's logical to be skeptical of chatgpt IPO etc but the sector as a whole is crushing and maybe because of fear will have some hiccups but will certainly prevail for a long time imo

jghn3• 8 days ago

People said similar things leading up to the dot com crash. The commercialization of the internet was indeed a watershed moment. That didn't mean it wasn't a bubble. Both can be true at the same time.

Schiendelman• 8 days ago

People whose job is writing code want it to be a bubble. It's probably not.

LBMs will eat robotics, and that alone will eat a double digit percentage of labor.

ductsurprise• 8 days ago

Should(or When) said 'bubble' 'pop', AI isn't going away or expected to lose relevance.

If you were around about the time of the Dot-Com bubble, you can better make sense of the saying.

The web never stopped being useful, it was the ridiculous and speculative valuations of companies, and outlandish claims that couldn't sustain themselves and eventually 'popped'.

PedroBatista• 8 days ago

Old samurai lost his marbles and his heir to the throne is busy making kingdom ending deals pretending to be an Hollywood mogul.

Life is good, I guess.. Java people should start sweating.

S&P Global has lowered Oracle’s creditworthiness from BBB to BBB-

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