What I've shared in this article are entirely my own thoughts. Please keep this in mind while reading. If you have a different perspective, criticism, or point you'd like to add, I'd be happy to see it in the comments.

I've looked at ORCL's balance sheet multiple times. Fundamentally, there's no major deterioration in the balance sheet; the cash side, debt ratio, and income structure are still under control. The problem isn't the balance sheet itself, but the continuous increase in expense items and the accelerating pace of this increase. This is precisely why the market reacted so strongly to ORCL.

Because investors see this: The company is making such large expenditures, yet it's still falling short of expectations. And when management announces an additional $15 billion in expenditures exceeding expectations, naturally, sales become both sharper and deeper. This is the classic market reflex: "Large spending → uncertain return → aggressive selling."

What I think is more important here is that investor psychology has completely changed in the last year. The market no longer trusts the "AI demand has exploded" narrative sung by the "hardware manufacturers"—companies that build data centers or provide cloud infrastructure. The more these companies claim demand is growing incredibly, the more skeptical investors become.

Why? Because investors are now asking: "Okay, you're spending a lot, okay, you say there's demand… but where's the return on investment? Where's the money?"

We've seen this in many examples recently. When $AMZN announced it would invest more in data centers, its stock came under pressure. Even when $NVDA said it would offer "even more capacity," the market remained cautious. The spending increase announcements from $MSFT and $META also dragged the stock down in the short term.

So who's the exception?

$GOOGL.

There will undoubtedly be those who ask, "Yunis, Google is also making huge expenditures, but its stock hasn't fallen, it's risen. How is that possible?"

I think the answer is simple:

The market now wants to see signs that AI is being monetized. Google gave that sign with Gemini. In other words, it more clearly conveyed the message, "We're not just sinking money into infrastructure; we're generating real product development and revenue from it." That's why GOOGL has diverged from the market in recent months and is positively priced.

NVDA's balance sheet also sent a separate message: Yes, there's an incredible need for chips. Yes, demand is surprisingly high. But a chip is essentially a shovel. Not everyone who picks up a shovel will find gold. The main question in the market is:

"So much infrastructure is being acquired, so many GPUs are being installed... But will this infrastructure actually translate into revenue-generating applications?"

Unfortunately, the answer to this question is not clear at the moment.

Very few companies are directly making money from AI today:

PLTR (enterprise software and defense),
APP (mobile advertising),
META (AI-powered advertising efficiency),
and a few smaller players...
Most of the rest are still increasing costs but not showing a significant increase in revenue in return.

This question mark didn't exist before. Because the market was operating on the logic that "AI will change the future, so spending is normal." But now investors are more selective. The market no longer wants to see infrastructure spending; it wants to see revenue conversion.

That's why, the moment a company says, "We're going to increase our AI spending"—as in the case of Oracle's $15 billion example—a sharp sell-off ensues. Investors no longer like the spending itself; they want to see the return on investment. Those who can't demonstrate it are immediately penalized.

In short, the market's message is very clear:

"Spend on AI, but show me proof that it will make me money. Otherwise, I'll sell you off."

It's also worth adding that the market no longer values ​​OpenAI's "investment promises" as much as it used to. In fact, many investors believe OpenAI doesn't have a strong enough balance sheet to finance these massive projects. Therefore, even though approximately $300 billion of Oracle's announced $523 billion backlog is from OpenAI, the market virtually ignores this portion. Because in the eyes of investors, the likelihood of these orders being fulfilled is weak, the financial security is insufficient, and their sustainability is uncertain.

The information, comments and recommendations contained herein are not within the scope of investment consultancy. Investment consultancy services are provided within the framework of the investment consultancy agreement to be signed between brokerage firms, portfolio management companies, banks that do not accept deposits and customers. The comments in this article are only my personal comments and these comments may not be appropriate for your financial situation and risk return. For this reason, investments should not be made based on the information and comments in my articles.