Companies linked up with Google’s AI business are mooning. Everyone else wants to get off OpenAI’s wild ride

The TL;DR trade within AI has recently been “long Google and its supply chain partners, short anything closely affiliated with OpenAI.” The Google ecosystem has been booming, while key OpenAI suppliers and investors have been languishing.

Early last week, a high-profile relationship with OpenAI was a millstone around your neck. The ChatGPT maker seemingly getting smoked by Google’s Gemini 3 while burning a lot of cash, with no end to the red ink in sight, made for a bad look for many of its allies.

SoftBank is a useful way to express a view on how OpenAI is doing because the Masayoshi Son-led firm is poised to own about 11% of the company. In the month of November, the stock fell 40%.

Microsoft has a tighter partnership with and bigger equity position in OpenAI than SoftBank. On the plus side, it’s also a successful company in its own right, but that didn’t stop some pain early last week.

Oracle’s stock peaked after it was revealed it had cut a $300 billion deal with OpenAI. More recently, credit default swaps tied to Oracle’s debt have also widened significantly, as the company’s infrastructure build-out is launching to fulfill demand from OpenAI, a customer that’s considered to be significantly less creditworthy.

On Wednesday, at least, they got a little relief, as the Nvidia-CoreWeave-Oracle-AMD coterie of OpenAI-linked stocks did better. In what’s very positive for markets on the whole, outperformance of the OpenAI-linked cohort rather than intense pain for the Google group means that everybody’s ships rise a bit.

The Takeaway

OpenAI has been scrambling to figure out how to generate enough steady revenue to turn the expensive AI services it offers into profits, as it spends dizzying sums on the infrastructure needed to scale its business (or at least, convinces its partners to shoulder debt on its behalf) to meet the expected demand. It has done a very good job of lashing together a raft of public companies in its quest to dominate what is hoped by Wall Street to be a remarkably lucrative business.

But just because it’s assembled a coalition of the shilling around the AI trend doesn’t mean it’s immune to competition, and Alphabet seems by far the strongest contender it’s up against.