Oracle and OpenAI Are Full Of Crap

Source: Where’s Your Ed At Date: 2025-09-12 URL: https://www.wheresyoured.at/oracle-openai/

Summary

Zitron tears apart the Oracle-OpenAI $300B computing deal as financial theater. Oracle missed earnings but saw a 39% stock bump driven by $317B in “remaining performance obligations” — RPOs weaponized as a marketing metric. The underlying math is impossible: Oracle projects cloud revenue growing from $18B to $144B by FY2030 (68% annual growth), dependent almost entirely on OpenAI, whose actual burn rate Zitron estimates at $290B through 2029 against a “leaked” $115B figure. The global AI compute market is ~$40B total; Oracle and OpenAI are projecting consumption that exceeds all current industry activity combined.

Implications

• RPOs are the new ARR. Both metrics allow companies to inflate apparent financial health without reporting actual cash. Oracle’s RPO move is the same playbook as OpenAI’s ARR announcements — announce a massive contract, book it as obligation, let analysts praise the “momentous quarter.”
• The data center construction timeline is the physical constraint. Vantage Data Centers took $38B in debt for two sites; only one has broken ground. Every AI capex projection implicitly assumes construction completes on schedule.
• Watch: Oracle FY2027 cloud infrastructure revenue actuals vs. the $144B projection. Any shortfall cascades directly into OpenAI’s compute availability.