Oracle bet $300 billion on OpenAI. It is paying the price.

Oracle may have an OpenAI problem.

Oracle ( ORCL ) stock is down nearly 40% from its September peak, wiping more than $360 billion from its market capitalization. About $67 billion of that decline occurred on Thursday alone, as Oracle’s second-quarter results failed to ease a key concern for investors — that the company is too reliant on OpenAI ( OPAI.PVT ).

AI-fueled growth goals outlined in Oracle’s first quarter sent the stock to a record on Sept. 10, briefly making its founder, Larry Ellison, the world’s richest man. Back in September, the company told investors that its remaining performance obligations (RPO) — or the value of future revenue from signed customer contracts — had risen nearly 360% to $455 billion.

It was later revealed that ChatGPT developer OpenAI had written off at least $300 billion of its customer commitments as part of the Stargate project. Since then, its stock has struggled.

In addition to Oracle, growing concerns about the rising cost of OpenAI due to deals with firms including Nvidia ( NVDA ), CoreWeave ( CRWV ), AMD ( AMD ), and Broadcom ( AVGO ) — set to reach $1.4 trillion — and growing competition from Google’s ( GOOG ) Gemini models have made investors more belligerent.

“There’s clearly been a reversal in the market perception of OpenAI over the last couple of months,” BNB Paribas analyst Stefan Sloinski told Yahoo Finance. “The OpenAI ecosystem has obviously suffered as a result.”

Slowinski and other Wall Street analysts agree that OpenAI’s potential inability to pay for its broader AI infrastructure commitments is Oracle’s biggest risk.

Read more: How to protect your portfolio from the AI ​​bubble

OpenAI CEO Sam Altman announced a “code red” last week as the upstart faces massive competition from Google, threatening its ability to monetize its AI products and meet its ambitious revenue goals.

“[Oracle is] This is the difficult situation where they have to build [data center] Capacity for this client and borrow a lot of money to do that when there is very high uncertainty that this client will be able to pay for that capacity,” said DA Davidson analyst Gil Luria.

Oracle’s second-quarter results only deepened investor concerns this week.

The company’s $12 billion in capital expenditures was higher than expected, just as its $10 billion in free cash flow losses and $6 billion in outflows were much heavier than expected. Oracle also raised its full-year capital forecast to $50 billion from $35 billion.

Efforts by executives to allay concerns about the company’s high debt load, rising costs and reliance on OpenAI did not help.