OpenAI’s partners are shouldering nearly $100 billion in debt linked to the AI firm, with SoftBank, Oracle, and CoreWeave borrowing heavily. This strategy leverages others’ balance sheets, as OpenAI itself holds minimal debt. Oracle faces the largest exposure, with its stock value significantly impacted by these arrangements.
OpenAI‘s data center partners are accumulating nearly $100 billion in borrowing linked to the loss-making artificial intelligence startup, with the financial burden falling on suppliers rather than the ChatGPT maker itself, according to Financial Times analysis.SoftBank, Oracle, and CoreWeave have borrowed at least $30 billion to invest in OpenAI or construct its data centers, while investment group Blue Owl Capital and infrastructure companies like Crusoe rely on OpenAI customer contracts to service approximately $28 billion in loans. Banks are also negotiating another $38 billion loan for Oracle and Vantage Data Centers to fund additional OpenAI sites, the FT reported.
Circular financing strategy raises systemic concerns
The debt pile is particularly striking given OpenAI’s $1.4 trillion in procurement commitments over eight years far exceed its expected $20 billion annualized revenue this year. “That’s been kind of the strategy,” a senior OpenAI executive told the FT. “How does [OpenAI] leverage other people’s balance sheets?”Meanwhile, OpenAI itself maintains little debt, with a $4 billion credit facility secured last year but not yet drawn.Many financing deals involve special purpose vehicles and structures designed to shield investors from default risk, with some loans having no recourse to developers, meaning lenders would absorb losses if payments fail.
Oracle takes biggest hit as market questions viability
Oracle has emerged as the most exposed partner. Since announcing its $300 billion OpenAI deal in September, Oracle’s stock has shed $315 billion in market value, according to FT Alphaville. KeyBanc Capital Markets analysts predict Oracle will need to borrow $100 billion over four years to deliver its OpenAI contracts.The arrangements feature circular elements, with OpenAI receiving billions from tech companies before routing those funds back to purchase computing power and services. The $100 billion in bonds, bank loans, and private credit tied to OpenAI equals the net debt of the world’s six largest corporate borrowers combined, including Volkswagen and Toyota, the FT noted.
