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Oracle Stock Hits New Highs as CloudWorld, AI Growth, and TikTok Deal Loom
Oracle (NYSE: ORCL) has become one of the most talked-about stocks on Wall Street, surging more than 100% in just six months as it cements its role as a rising powerhouse in cloud computing and artificial intelligence (AI). Fueled by record growth in its cloud division, massive backlogs, and groundbreaking partnerships with AI giants like OpenAI, the company is now firmly in the spotlight.
A Meteoric Stock Rally
Over the past half-year, Oracle shares have soared 102%, powered by booming demand for cloud infrastructure and a backlog nearing $455 billion. High-profile deals, including a confirmed $300 billion+ multi-year agreement with OpenAI, have pushed enthusiasm to new highs. Talk of a potential $20 billion contract with Meta Platforms further underscores Oracle’s momentum in the AI race.
However, this rapid ascent has come at a cost. Oracle now trades at a steep premium—about 63x forward earnings on a GAAP basis—more than double its five-year average. Despite valuation concerns, technical indicators remain bullish. The stock continues to ride its upper Bollinger Band, with momentum and volume pointing toward potential gains beyond the $340–$350 range.
Building the AI Infrastructure of the Future
Oracle has aggressively positioned itself as a leader in AI infrastructure, betting big on GPU-rich OCI Superclusters. Its partnership with OpenAI validated this approach, with clusters capable of scaling up to 131,072 Nvidia GPUs each, offering unmatched latency and execution speed.
The company has also secured early access to Nvidia’s Blackwell GPUs while layering in AMD MI300X chips, giving clients flexibility and cost efficiency. These moves allow Oracle to deliver compute-hungry workloads at competitive prices—an advantage that’s proving crucial in today’s AI arms race.
Beyond OpenAI, Oracle has struck multi-billion-dollar agreements with Elon Musk’s xAI and is reportedly in advanced discussions with Meta. Combined with a 16x surge in revenue from multi-cloud partnerships with Microsoft Azure, Amazon Web Services, and Google Cloud, Oracle’s ecosystem is expanding rapidly.
Innovation at the Core
Oracle is not just building raw infrastructure—it’s innovating at the software level as well. Its new Database 23c “AI” includes native vector search for machine learning workloads, while its AI Agent Studio enables enterprises to build LLM-powered agents using frameworks from Meta’s Llama or Cohere.
These tools position Oracle as more than just a cloud provider; they make it a critical enabler of enterprise AI adoption across sectors like finance, HR, and operations.
The TikTok Factor
One of the most intriguing storylines around Oracle involves TikTok. Through Project Texas, Oracle already secures data for more than 100 million U.S. TikTok users, placing it at the center of ongoing geopolitical debates.
With U.S. lawmakers pressuring ByteDance to divest TikTok’s U.S. arm, Oracle has emerged as a leading candidate for a potential acquisition. Such a deal, valued between $40 billion and $50 billion, could transform Oracle from an enterprise cloud giant into a consumer technology heavyweight with vast reach in social media and advertising.
Financing such a purchase remains a challenge, given Oracle’s $93 billion net debt and limited cash reserves. Yet, industry watchers see the possibility of a consortium involving partners like Silver Lake and Andreessen Horowitz—with Oracle in the driver’s seat.
Risks Lurking Beneath the Surface
Despite its explosive growth, Oracle’s strategy carries significant risks. The company spent over $27 billion in capex last year and plans to invest another $35 billion, a move that pushed free cash flow negative by $5–6 billion. Heavy reliance on Nvidia and AMD chips also leaves Oracle vulnerable to supply shocks.
Meanwhile, customer concentration is a concern. A massive portion of Oracle’s backlog comes from OpenAI, which remains unprofitable and cash-intensive. If OpenAI stumbles, Oracle could face a sizable revenue gap. Credit agencies have already taken note, with Moody’s shifting its outlook to negative due to swelling debt and execution risks.
Looking ahead, Oracle’s near-term catalysts include its upcoming CloudWorld event and developments around TikTok. Analysts expect Oracle’s forward P/E to compress to 27x by 2028, supported by an EPS forecast of $11.26.
For now, Oracle’s blend of AI mega-contracts, multi-cloud strategy, and relentless innovation keeps investor enthusiasm alive. But with the stock priced for perfection, volatility is almost inevitable.
