Oracle shares fell about 4% on Thursday after Bloomberg News reported that the company sent a force majeure notice to the developer of a large data center in New Mexico, a step meant to shield it from potential cost increases tied to the project. The stock had dropped nearly 5% in premarket trading and led losses among Nasdaq names.
According to the report, which cited people familiar with the matter, Oracle delivered the notice to a unit of Blue Owl Capital that is developing the campus, known as Project Jupiter. The notice is intended to let Oracle delay payments if the facility fails to come online as planned in 2028. Reports described the move as a protective mechanism rather than an exit from the project, since Oracle is the primary tenant. Reuters said it could not independently verify the Bloomberg report.
Oracle pushed back on the interpretation. A company spokesperson told CNBC that Project Jupiter remains on its planned schedule and that Oracle is fully committed to New Mexico and confident in its path forward. Blue Owl said the notice does not change the financial commitments to the multi-year project. The campus is part of the broader Stargate artificial intelligence infrastructure buildout backed by President Donald Trump and has faced local opposition and regulatory setbacks.
A force majeure clause allows a party to suspend or delay contractual obligations when unforeseen events beyond its control interfere with performance. Investors read the notice as a signal of how sensitive AI infrastructure economics have become. Building hyperscale data centers requires billions of dollars in capital spending, and delays in permitting, construction or supply chains can raise costs and postpone the revenue those assets are supposed to generate. Any hint of friction can prompt questions about how efficiently a company is deploying its cash, particularly when the market is already scrutinizing the return on AI investment.
The timing compounds the pressure on technology shares. Nasdaq 100 futures were down about 1.1% in early trading as Treasury yields extended a global bond selloff, with the 30-year yield reaching its highest level since 2004 and the 10-year near 5.15%. The Nasdaq Composite was down roughly 0.8% during the session. Long-duration growth stocks with heavy capital needs are especially exposed when financing costs rise, and Oracle is widely watched as a bellwether for AI cloud spending sentiment.
The episode also highlights the role of private capital in the AI buildout. Developers such as Blue Owl's unit finance and construct facilities that large tenants then lease, which spreads risk but also creates contractual pressure points when timelines slip. How the parties handle payment obligations if Project Jupiter is delayed could become a template for similar deals elsewhere.
For traders, the near-term question is whether the notice proves a contractual formality or the first sign of broader delays across large AI campuses. Watch for further comment from Oracle and Blue Owl, any local or regulatory developments in New Mexico, and whether other AI infrastructure names trade in sympathy. The report has not changed either company's stated commitments, but it has added a fresh execution risk to a sector already sensitive to rising rates.