OpenAI's $1.2 Trillion Valuation Could Lift Oracle from AI Slowdown Fears?

Barron's reports that a shadow of potential pause in artificial intelligence development is looming over companies like Oracle (ORCL-US) and CoreWeave (CRWV-US), which have heavily bet on the AI boom. However, news about OpenAI reportedly seeking further fundraising at an ultra-high valuation could provide some relief.

The Wall Street Journal cited sources on Tuesday evening, reporting that OpenAI has held preliminary talks for a new funding round, with a potential valuation exceeding $1.2 trillion.

This would be positive news for Oracle and CoreWeave. Oracle signed a $300 billion partnership with OpenAI to jointly build AI data centers, with the project set to continue through 2030. CoreWeave has a cloud computing contract with OpenAI worth up to $22.4 billion.

If OpenAI completes a large-scale fundraising round, even if it delays its IPO, it should reinforce market confidence that the AI firm can fulfill its spending commitments. CEO Sam Altman said this week he expects OpenAI will not go public this year due to safety concerns. The company was valued at $852 billion in March.

The OpenAI fundraising news comes at a timely moment. Oracle and CoreWeave's stock prices had previously plunged alongside broader tech stocks, after AI industry leaders, including Altman, indicated over the weekend they would support slowing down AI model development.

Oracle's stock opened weaker on Wednesday but rebounded in the afternoon to close up 2%. Prior to this, the stock had declined for five consecutive trading days, with a cumulative drop of 13%.

CoreWeave's stock closed up 3% on Wednesday, after falling 15% over the previous five trading days.

A pause in AI development could mean slower data center construction and reduced spending on AI infrastructure in the future. However, OpenAI's current fundraising talks suggest this scenario may still be distant.

Brad Gastwirth, Global Head of Research and Market Intelligence at Circular Technologies, wrote in a research report: "Recent statements by leading AI executives have heightened market discussion around the pace of advanced model development, independent evaluation, and stronger governance mechanisms. We do not believe these statements signal a meaningful near-term shift in infrastructure demand."

He added, "There has been no announcement of coordinated slowdown measures, nor any binding cap on compute resources, and major cloud providers continue to expand their computing capacity."

For investors, a practical rule of thumb is to watch what companies do, not just what they say. As long as OpenAI continues to raise funds, the prospect of a significant AI slowdown appears distant—good news for Oracle and CoreWeave.