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Oracle’s $300B OpenAI Contract Boosts Cloud Business
Oracle’s stock price surged by 35.95% to $328.33 per share, marking its largest single-day gain since 1992. This rally pushed the company’s market capitalization to $922 billion, surpassing Eli Lilly, JPMorgan Chase, and Walmart. Investors reacted positively to Oracle’s robust revenue growth projections, driven primarily by its expanding cloud business and AI computing capabilities.
Growth Driven by Cloud and AI Infrastructure
Originally renowned for its database software, Oracle has rapidly evolved into a major cloud computing provider. The company is now competing with giants like Amazon, Microsoft, and Google in the AI computing space. Oracle’s cloud segment is expected to grow significantly, supported by new deals and increasing demand for AI-powered infrastructure.
A key highlight is Oracle’s agreement with OpenAI, which Bloomberg reports will provide 4.5 gigawatts of data center capacity—enough energy to power millions of U.S. homes. The Wall Street Journal notes that this contract could be worth $300 billion over five years, illustrating the scale of Oracle’s involvement in AI infrastructure.
Strong Backlog and Bookings Signal Rapid Expansion
Oracle’s remaining performance obligations, a key metric reflecting future revenue bookings, reached $455 billion by the end of the fiscal first quarter. This is over four times higher than the previous year and about four times greater than Google’s backlog, according to Bloomberg Intelligence. This indicates Oracle’s cloud business is growing faster than Google’s, positioning it strongly in the cloud race.
CEO Safra Catz said the cloud infrastructure division will grow by 77% to $18 billion this financial year and is expected to reach $144 billion annually by 2030. These figures highlight Oracle’s aggressive growth plans fueled by expanding AI and cloud demand.
Impact on Related AI Stocks and Global Market
Oracle’s stock surge contributed to gains in other AI-related companies. Nvidia shares rose 3.8%, while suppliers in Asia, such as Japan’s Advantest Corp. and South Korea’s SK Hynix Inc., also rallied. This reflects the broader market optimism around AI investment and infrastructure development.
The Broader AI Investment Trend
Oracle’s outlook underscores the growing need for massive investments in AI infrastructure globally. OpenAI, a key customer, has stated it will require “trillions of dollars over time” to support its AI services, highlighting the scale of future infrastructure needs.
Other major U.S. companies have also signaled strong AI sector demand. Recently, Broadcom Inc. announced securing a significant new AI customer, reinforcing confidence in the sustainability of AI investments across industries.
Oracle’s Evolving Role in AI and Cloud Computing
Oracle’s strategic deals and ambitious growth projections firmly position the company as a major player in the rapidly expanding and highly competitive AI infrastructure market. What began as a company primarily known for its database software has transformed over the years into a formidable force within the cloud computing industry. This evolution has enabled Oracle to power a wide range of AI services on a global scale, supporting some of the most advanced artificial intelligence applications and workloads.
Through significant investments in data center capacity, cutting-edge technology, and strategic partnerships with leading AI innovators like OpenAI, Oracle is rapidly enhancing its capabilities to meet the soaring demand for scalable, high-performance AI infrastructure. As the market for AI-driven cloud services continues to grow exponentially, Oracle’s comprehensive approach—from foundational software to massive infrastructure deployments—allows it to compete effectively against major cloud providers such as Amazon Web Services, Microsoft Azure, and Google Cloud. This transformation not only broadens Oracle’s product and service portfolio but also cements its role as a critical enabler of the AI revolution worldwide.
