Folks, Oracle's latest earnings report has underscored the company's transformation into a dominant force in the AI and cloud infrastructure space. With fiscal Q4 revenue of $15.9 billion and earnings per share of $1.70, the company beat Wall Street's expectations on both the top and bottom lines. These strong results signal that Oracle's strategic pivot to AI-powered services is gaining traction. CEO Safra Catz highlighted this shift by forecasting fiscal 2026 revenue of at least $67 billion, a bump from the earlier projection of $66 billion. Analysts and investors alike are now viewing Oracle as a core beneficiary of AI-driven enterprise spending. While many tech firms are still navigating how AI will impact their models, Oracle appears to have found its sweet spot by embedding AI deeply into its core offerings. | | | The Power of Cloud and Infrastructure at Scale A major driver behind Oracle's recent success is the explosive growth of its cloud infrastructure business. Oracle Cloud Infrastructure (OCI) revenue is expected to jump over 70% year-over-year in fiscal 2026, up from 50% growth in the prior year. Even more impressively, total cloud revenue is projected to grow more than 40% annually. These figures don't even account for the potential uplift from the Stargate AI project, which remains in early stages. Jefferies analysts noted that Oracle expects remaining performance obligations (RPO) to more than double in FY26, compared to 41% growth in FY25. That growth is being fueled by large, long-term, non-cancelable contracts — a sign that enterprises are locking into Oracle's infrastructure for the long haul. Oracle's ability to scale its cloud operations and absorb future AI workloads may become a key competitive advantage as demand accelerates. Stargate and the Long Game in AI Though still forming, Oracle's $7 billion Stargate AI initiative is another bold step that reflects the company's long-term vision. While the project faces delays — in part due to geopolitical uncertainties like President Trump's trade policies — it is viewed as a potential game changer in AI infrastructure. CEO Catz acknowledged that the reality of Stargate is still evolving, but emphasized that the company's financial targets do not rely on its success. In other words, Stargate is not a lifeline — it's upside. If Stargate delivers, it could be a significant catalyst that propels Oracle beyond even its elevated growth forecasts. The project's scale and ambition demonstrate Oracle's commitment to being not just a participant but a leader in the AI arms race. | | | Database Dominance Reinforced by AI Integration At the heart of Oracle's resurgence is its core competency: databases. As AI adoption grows, the role of databases in storing, vectorizing, and managing massive datasets becomes crucial. Oracle co-founder Larry Ellison was emphatic about the critical role that Oracle's database systems play in the training and deployment of AI models. "Who else is doing that? Let me answer the question — nobody," Ellison remarked, referencing Oracle's ability to store AI-ready data securely and efficiently. The company is capitalizing on the need for databases that are always available, scalable, and searchable by AI engines. This positions Oracle not just as a cloud vendor, but as a foundational pillar of the AI ecosystem, which differentiates it from more hardware-reliant tech peers. Analyst Confidence Reinforces Oracle's Momentum Analyst sentiment has quickly aligned with Oracle's performance narrative. Firms like Jefferies, Bank of America, UBS, and Deutsche Bank raised their price targets, some as high as $240, after the earnings release. While Jefferies maintained its Buy rating and increased its target from $200 to $220, JPMorgan took a more measured approach, upgrading its target to $185 while retaining a Neutral stance. What's notable is that even cautious analysts are acknowledging Oracle's execution in AI and cloud. Morgan Stanley also kept a more conservative $175 target, but admitted that Oracle's backlog could account for nearly 90% of its ambitious $104 billion FY29 revenue goal. The takeaway: whether bullish or neutral, Wall Street sees Oracle as a formidable force in enterprise AI. Capital Expenditures Signal Strategic Confidence Oracle isn't just talking about AI growth — it's investing heavily in it. The company has significantly raised its capital expenditures forecast to $25 billion for fiscal 2026, well above the Street's expectation of $20 billion. According to JPMorgan, this increase could limit free cash flow in the near term, but it underscores Oracle's confidence in scaling its infrastructure ahead of the curve. Chairman Larry Ellison went so far as to say Oracle will build more data centers than all its cloud infrastructure competitors combined. While such aggressive spending introduces financial pressure, it also reflects the high-stakes nature of the AI race. Oracle is betting big on long-term dominance, even if it comes at the cost of short-term margins. | | | A Safer AI Play Amid Global Volatility One element boosting Oracle's appeal is its positioning as a comparatively safe AI stock. Unlike chipmakers that depend heavily on China and Southeast Asia, Oracle's business is more insulated from geopolitical risk. Synovus VP Dan Morgan noted that Oracle faces fewer vulnerabilities from tariffs or trade wars, which makes it a more stable choice for investors seeking AI exposure. With its software-first model and domestic infrastructure expansion plans, Oracle is less reliant on fragile supply chains. As global tensions continue to cloud the tech outlook, this aspect could make Oracle even more attractive to institutions seeking AI investments with reduced exposure to international disruptions. | | | Also, quick plug... Don't forget about our brand-new ZipTrader+ discord! You'll get access to the following features: ✅Daily Morning Briefing ✅Charlie's Options Ideas ✅Realtime News Alerts (A.I.) ✅Whale & Algo Buy Alerts ✅Price Targets ✅Algo Trading Report ✅10+ Hour ZipTraderU Lesson Library & Much More... | | | Want in? Sign up for ZipTrader+ and get FULL ACCESS HERE! Anyways... That's all for now! Until Next Time, -Damian | P.S. Want our text alerts? Text "ZIPTRADER" to 1-(855)-228-1598 to sign up!
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