Inside Larry Ellison's debt-fueled push to turn Oracle into an AI juggernaut by aligning with Trump, backing Project Stargate, and partnering with OpenAI
the first full day of the second Trump administration — Larry Ellison woke up in his 33-bedroom, 34-bathroom oceanfront mansion in Florida …
New York Times
Context & Ripple Effects
Oracle’s AI positioning follows a period in which the company and Safra Catz were reported to have capitalized on the AI boom, building on the market momentum that lifted Oracle shares in 2024. Ellison’s relationship with Trump is also longstanding, from earlier fundraising to a reported $45 million donation supporting Trump.
This coverage connects those political and financial relationships to a more capital-intensive AI strategy involving OpenAI and Project Stargate. The consequential shift is not simply Oracle seeking AI demand, but using leverage and partnerships to compete for a more central role in supplying it.
First-order effects
Oracle takes on greater financing exposure as it funds an AI expansion with debt, making execution of its OpenAI and Project Stargate commitments more consequential for the company.
OpenAI gains another strategically aligned infrastructure partner, while Ellison’s proximity to the administration becomes more directly relevant to Oracle’s AI agenda.
Second-order effects
Oracle’s cloud and infrastructure rivals face a more aggressive competitor for AI workloads, particularly where customers value capacity, financing scale, or close ties to major AI platforms.
Debt-funded expansion raises the importance of sustained utilization and customer commitments across the AI infrastructure chain; weaker-than-expected demand would put greater pressure on highly financed buildouts.
Third-order effects
If this model persists, AI infrastructure may become increasingly concentrated among companies able to combine balance-sheet leverage, platform partnerships, and political access—not only those with the strongest underlying technology.
The overlap of frontier-AI supply, large-scale financing, and government relationships could intensify scrutiny of how infrastructure opportunities and policy priorities are shaped.
The trend: This is one data point in the financialization of AI infrastructure, where access to capital, strategic partners, and deployment channels increasingly determines competitive position.
In his efforts to pivot Oracle into an A.I. juggernaut, the billionaire Larry Ellison took on massive levels of debt. If he fails, Ellison could become the poster child for the A.I. bubble. https://www.nytimes.com/...
@simonowens @davidfolkenflik I'm not sure about this. As we've all reported and the NYT also notes, Ellison has no intention of footing the whole bill for WBD. 38.5 billion is supposed to come from gulf states, and he can also syndicate much of the other cost to other investors.
“But lately, some investors and analysts have started questioning the scaling hypothesis or at least asking if all this spending is sustainable. The market has been gyrating wildly in recent weeks, as concerns have grown about whether the trillions of dollars being furiously pump…
@simonowens @davidfolkenflik Btw: The Netflix critique of the deal is that the giant cost *already* requires him to gut the combined companies, regardless of his cost and source of capital.
“An A.I. crash would wipe out $20 trillion in American wealth — far more than the dot-com crash in 2000 or even the 2008 financial crisis.” — www.nytimes.com/2026/07/31/m...
'"To me, it's a math problem," says Asad Ramzanali, director of AI at Vanderbilt. “We are making trillions of dollars in investments on the back of tens of billions of dollars in revenues.” The growing consensus is that these kinds of numbers add up to a bubble.' www.nytimes.co…
I enjoyed this Times piece on Oracle — it's a different tack, with different reporting, on the same theme I wrote about in April. the similarities are because we're describing consensus reality www.nytimes.com/2026/07/31/m...
sure would be something if Larry Ellison's last few years involved him losing his shirt on AI as the state antitrust lawsuit dismantles his nepobaby son's debt-riddled dreams of media domination
Ed Zitron has been on this for a long time, but good to see that the NY Times finally is digging into Silicon Valley OG Larry Ellison's sleazeball ways — and his prop-up-Oracle-stock-until-it- crashes bets on AI. — https://www.nytimes.com/...