Wall Street Lunch: Oracle Draws  Line On AI Data Center Delays

Oracle (ORCL) has sent a force majeure notice to the developer of a massive datacenter project in New Mexico to protect itself from potential payments if the facility is delayed, Bloomberg reported. The Project Jupiter site is designed to have 2.45 gigawatts of capacity and is part of the broader Stargate AI infrastructure effort involving Oracle, OpenAI (OPENAI) and SoftBank. The datacenter is being developed by Stack Infrastructure, a portfolio company of Blue Owl Capital (OWL). Oracle is the main tenant. Oracle, SoftBank and Blue Owl are lower, as is Bloom Energy (BE), whose cells were planned for use at the facility. Oracle is seeking to defer payments if the project is delayed and does not come online as planned in 2028. It was not immediately clear whether the notice would release Oracle from its existing financial obligations.

New research from the Brookings Institution projected that the AI infrastructure boom could require $10.3T of U.S. investment through 2032. Spending on datacenters, power systems, networking and specialized computing equipment could average about 3.6% of U.S. GDP annually, the study said. That would make the AI buildout larger than historic U.S. investment booms in railroads, highways, electrification and telecom. But a growing share of the financial risk is expected to shift away from Big Tech balance sheets and into less-transparent financing structures, making overall exposure harder to assess. Concerns about rising borrowing costs for AI capex have contributed to the latest rise in Treasury yields. Today yields are easing back a little, but not before the 10-year yield (US10Y) topped 5.15% and the 30-year (US30Y) hit 5.44%, its highest level since 2004.

Among active stocks, BlackBerry (BB) reported Q2 results above estimates and raised its fiscal 2027 revenue and profit outlook, helped by demand for its QNX automotive software.

MGM Resorts (MGM) is tumbling after Barry Diller's People Inc. (PPLI) withdrew its takeover offer. "There are lots of ingredients that go into a proposal of this kind on its way to completion," Diller said. "We didn't feel the mix was coming together in the way we had hoped and have decided not to pursue taking the company private at this time."

And oil stocks are in focus as the oil and gas industry launches a coordinated lobbying campaign to block a potential ban on U.S. diesel exports after President Donald Trump signaled such a proposal, warning that trade restrictions would spike domestic fuel prices. Chevron (CVX) CEO Mike Wirth, Phillips 66 (PSX) CEO Mark Lashier and other senior executives have started calling their contacts in the administration to push back on the idea of a ban, according to the Wall Street Journal.

And in other news of note, Meta Platforms (META) unveiled Meta Charm, a handheld AI device, at its Connect event Wednesday. Roughly the size of an AirPods case, Charm features a 2-inch OLED touchscreen and built-in 5G connectivity. CEO Mark Zuckerberg said: “We pack the whole Muse experience, including the whole re...