AI chip and tech stocks are falling again after gloomy Oracle earnings reignite bubble fears. Here's the latest

Core Viewpoint - Oracle's disappointing Q2 2026 earnings results have led to a significant drop in its stock price, impacting the broader tech and AI sectors [2][3][8]. Financial Performance - Oracle reported non-GAAP earnings per share (EPS) of $2.26, a 54% increase year-over-year, and total revenue of $16.1 billion, up 14% [6]. - Despite beating EPS expectations, Oracle's total revenue fell short of analyst forecasts of $16.21 billion, contributing to a 12% decline in its stock price [3][8]. Market Reaction - Following Oracle's earnings report, major chip companies in the AI space experienced stock price declines, including Advanced Micro Devices (down 1.2%), Arm Holdings (down 1.2%), and Nvidia (down 1.3%) [7]. - Broader tech stocks also faced declines, with Alphabet down 0.5%, Amazon down 0.7%, and Microsoft down 0.6% [10]. Industry Concerns - Oracle's new agreements with AI investors like Nvidia and Meta have raised concerns about circular spending in the AI industry, which could indicate a potential bubble [4]. - The total remaining performance obligations for Oracle increased to $523 billion, but investor fears about the sustainability of AI investments have intensified [4].