Oracle cites force majeure on Project Jupiter as 2028 slips
Oracle has spent the week telling investors its AI backlog is real. On Thursday it told the developer of its largest New Mexico campus that it may stop paying for it.
Oracle shares fell 4% after Bloomberg reported the company sent a force majeure notice to Blue Owl Capital, the developer behind Project Jupiter, aiming to delay payments on the 2.45-gigawatt campus if it does not come online as expected in 2028. A force majeure clause is the contract language for hurricanes and wars — events nobody can control — and Oracle is reaching for it pre-emptively to protect itself from higher expenses. That is a commercial hedge, not an act of God, and it is the first time the company has put in writing what bankers have been pricing for weeks.
The project has been sliding in plain sight. Roughly $18 billion of debt tied to the campus moved into stressed territory earlier this month, and Reuters reported that banks were left holding more Oracle-linked paper than they planned because the syndication never fully cleared. The site itself — about 1,400 acres in Santa Teresa, backed by up to $165 billion in county-approved industrial revenue bonds — has roughly 3,500 workers on it, and the gas pipeline meant to power it already slipped to 2027. Oracle's co-CEO Clay Magouyrk said out loud what the notice now formalizes: betting on everything landing on time is a "bad plan." We flagged the credit turn when it landed — Oracle's $18B New Mexico data center debt turns stressed.
Why it matters: off-balance-sheet data center finance only works if the schedule holds. When the tenant starts writing escape hatches into the lease, the risk moves from Oracle's income statement onto whoever is holding the paper — and onto the next campus in the queue, which will be priced against this one.
ASML's top public-affairs executive says the company sold "absolutely nothing" in Europe this year, and he wants Brussels to fix the demand side rather than keep subsidizing fabs. Frank Heemskerk told Dutch television that Europe accounted for 0% of ASML's revenue in both the first and second quarters of 2026, down from 1% in 2025 and 5% in 2024. "There simply is no demand here for these kinds of highly specialized machines," he said, adding that ASML is talking to European Commission President Ursula von der Leyen about aggregating and guaranteeing demand for European-made chips.
It is a strange position for Europe's most valuable listed company: the machines that make every leading AI chip are built in Veldhoven and sold to Korea, Taiwan, China, the US and Japan, in that order. Europe has been paying to build capacity — Intel's Irish expansion, a €15 billion TSMC-backed fab near Dresden, Infineon's new €5 billion plant — without creating the buyers who would fill it. Guaranteed demand is industrial policy by another route, and it is the honest version: the fabs were never the bottleneck. Europe's AI strategy has a customer problem, and ASML just said so on television.
What to watch: whether Blue Owl and Oracle's lenders renegotiate quietly at a wider spread, and whether Brussels treats "create demand" as a procurement commitment or a working group.
Should a data center tenant be allowed to invoke force majeure before the deadline is even missed? Tell us in the comments.
