The bifurcation in the artificial intelligence space will continue again. On Wednesday, Nvidia (NVDA), Broadcom (AVGO), Alphabet (GOOGL), and Advanced Micro Devices (AMD) led the decline. Palantir (PLTR) and Oracle (ORCL) also fell on the day.
Oracle is in an especially weak position. Blue Owl Capital is reportedly in delays for funding a massive $10 billion data center build in Michigan. The firm was supposed to consider funding the OpenAI facility, worth 1 gigawatt. Unfortunately, Oracle’s debt/equity ratio of around 500% is worrying Blue Owl.
Oracle later denied the Financial Times report. The database software firm said that the project would continue, and that Blue Owl was not a participant in it.
Micron Technology (MU) is today’s brighter spot for the AI space. The memory chip supplier set an EPS forecast of $8.19, +/0 $0.20, in the fiscal second quarter. This is more than double the consensus estimate. Expect MU stock to rise by at least 8% today.
Micron earned $4.78 a share in the first quarter (non-GAAP). Revenue topped $13.64 billion. Investors bullish on the AI boom are expecting MU stock to gain at least 20% after the solid guidance. However, rallies take time. The market might need the triple witching options day to play out first. After bears close their various positions, MU stock could rally more later this month.
