Oracle Rides AI Cloud Wave Despite Earnings Miss
Oracle’s stock has almost doubled in 2025, lifted by its $300 billion deal with OpenAI. Even though Q1 FY26 earnings underwhelmed at $14.9 billion revenue and $1.47 EPS, investors rallied around the company’s forecast for $18 billion in cloud infrastructure revenue this year and long-term growth to $144 billion by FY30.

Safra Catz highlighted record contracts and a backlog of $455 billion, up 359% year-over-year. Partnerships with OpenAI, Meta, and Elon Musk’s xAI underline Oracle’s growing role in AI infrastructure, where it sees an edge in inference workloads tied to its proprietary databases.

But risks loom: $35 billion in capex planned for FY26, aggressive rivals like AWS and Google, and broader macro uncertainty. Analysts remain divided — many hail Oracle’s pivot as historic, while others caution its growth could depend on rivals offloading demand.

TipRanks shows a price target of $263.93, well below the current price, suggesting valuations may be overheated unless AI delivers lasting enterprise returns.