Oracle sent its shares soaring after markets closed yesterday after reporting that it signed multiple multi-billion-dollar contracts with several customers. Now, we have an idea of who those customers might be.
Rishi Jaluria, RBC software analyst, joins 'The Exchange' to discuss the outlook for Oracle as the stock's shares soar, its global AI infrastructure and the Microsoft trade.
The S&P 500 and Nasdaq climbed to record highs Wednesday following a report showing wholesale inflation surprisingly fell in August. The Dow slid, however, led by a drop in shares of Apple (AAPL), after the tech giant launched its iPhone 17 models yesterday.
Oracle Corporation's after-hours surge is driven by massive cloud RPO growth, but margin declines and stagnant EPS raise red flags for long-term investors. Despite strong enterprise positioning and huge new contracts, Oracle's high P/E ratio is hard to justify given its earnings trajectory and competitive risks. Reliance on Nvidia silicon, while peers develop custom chips, threatens Oracle's future margins and market share as hyperscalers drive costs lower.
Oracle began building up its cloud-computing business to compete with Amazon and Microsoft a decade ago. AI has supercharged its growth.
Stocks looked set to rise on Wednesday, as investors awaited the first of two key inflation reports.
Oracle Corp (NYSE:ORCL, ETR:ORC) shares rocketed 31% in after-hours trading after the company unveiled a blockbuster cloud growth forecast, brushing aside a slight earnings miss to ignite investor excitement. The software giant now expects its cloud infrastructure revenue to reach $144 billion in fiscal 2030, up from $10.3 billion in 2025 — a projection that helped send its stock soaring to levels not seen since the dot-com boom.
Shares of Oracle rose 31% in Frankfurt on Wednesday, a day after the company said it expects booked revenue at its Oracle Cloud Infrastructure business to exceed half a trillion dollars.
There's no denying the trajectory of artificial intelligence (AI) over the past few years. Many of the companies that have pivoted to adopt this game-changing technology have ascended the ranks of the world's largest companies when measured by market cap.
As Oracle's stock was soaring following the company's earnings report on Tuesday, analysts were gushing about the numbers and the company's prospects in artificial intelligence. "I'm sort of blown away," said John DiFucci, an analyst at Guggenheim.
Oracle said in its earnings report that remaining performance obligations jumped 359% from a year earlier, indicating big growth prospects. Earnings and revenue for the latest quarter missed estimates.
Paul Meeks looks at Oracle (ORCL) ahead of the company's earnings report. He expects them to continue to show momentum as it plays a central role in the A.I.