People are questioning the huge financing demands of the AI build out. If the financing isn’t there, then perhaps sky-high AI stock prices don’t make sense. From Quoth the Raven at quoththeraven.substack.com:
…and things can unravel faster than expected.
Blue Owl Capital’s decision this morning to walk away from a $10bn data center deal for Oracle may prove to be an important inflection point in the AI infrastructure boom.
Blue Owl isn’t a marginal player or a nervous tourist—it has been one of Oracle’s most significant financial partners, repeatedly stepping in with equity and debt to help fund large-scale data centre projects. When a firm that specializes in financing hyperscale infrastructure decides that a flagship AI project no longer makes sense on its terms, it suggests that the economics of these deals may be becoming harder to justify. In my opinion, this isn’t about headlines or short-term sentiment; it’s about the underlying numbers becoming less forgiving.
Blue Owl walking away from this deal is, in my view, one of the clearest signs so far that the AI infrastructure build-out may be running into real financial constraints.
This wasn’t a speculative startup or an untested operator. Blue Owl has helped make Oracle’s AI expansion possible by absorbing risk that public markets and balance sheets were reluctant to carry directly. If that support is now being reconsidered, it implies that something fundamental has shifted. At a minimum, it suggests that the margin for error is shrinking fast.
It’s all Potemkin, you have to produce something.
This will never change, sorry techno triumphalists.
Read one today that Trump is not building a big ballroom but an AI bunker!