Two completely unsurprising stories today that speak volumes about where we are in the data center buildout cycle. Oracle is pushing out some data center projects, and speculative Fermi's stock is being smashed over a lost prime tenant. Both have broader implications.
What’s happening
- Oracle is delaying some OpenAI data center projects to 2028, from 2027, citing labor and material shortages.
- The projects are part of a $300B contract signed this summer.
- The first OpenAI site in Abilene, Texas is claimed to be on track, but later phases are delayed.
- Oracle shares fell ~5–6% on the news, coming after Oracle had already been hammered this week over its earnings call.
- Separately, speculative Texas AI campus developer Fermi lost a $150M tenant commitment, triggering an impressive ~46% stock plunge.
- Fermi, pre-revenue and recently valued at ~$19B, has now lost over two-thirds of its value in two months.