Massive Backlog Shakes Up the Market
Oracle surprised people on Wall Street this week, promising a lot more money from future sales of AI, also cloud services. The company now has $455 billion worth of future work, a big jump from $138 billion three months ago. This represents money they’ve promised to deliver but haven’t yet recorded as income. This shows growth of 359 percent, a huge rise for a company the size of Oracle.
The figures quickly caused excitement in money trading. Oracle’s first-quarter profit came in a little below what experts predicted, earning $1.47 per share compared to an expected $1.48. Revenue reached $14.9 billion, slightly less than the anticipated $15 billion. However, the large amount of existing orders diminished the importance of these small differences. Stock prices jumped 29 to 33 percent before regular trading began, then again after it ended. This quickly made Oracle one of the best performing tech companies in the United States this year.
People who provide capital immediately linked the growing workload to large, recently publicized deals worth billions of dollars with important companies in the artificial intelligence field. Leaders at Oracle stated agreements with OpenAI, Meta, NVIDIA, AMD, xAI drove most of the company’s expansion. The deals show the company becoming more important as nations compete to build AI technology.
Oracle’s leader, Safra Catz, noted this surge in requests felt new to the company. She explained to experts we currently live through a huge shift in technology. Oracle develops the fundamental systems artificial intelligence businesses rely upon. We notice many people now plan to stick with us for a long time.
AI and the Future of Cloud Growth
More work is piling up because Oracle is heavily investing in cloud technology designed for artificial intelligence tasks. Other companies such as Amazon Web Services, Microsoft Azure, Google Cloud lead the cloud market, however Oracle found success by providing unique, fast cloud spaces for developing, using AI models.
The business currently predicts its cloud infrastructure income will increase by 77% this year, reaching $18 billion. Oracle shared plans to reach $144 billion yearly from cloud services by 2030, powered by work with artificial intelligence.
A key part of our growth involves the Stargate project, a collaboration with several companies to construct huge data centers specializing in artificial intelligence. These centers will manage incredibly large tasks. Experts think Stargate is mainly causing the large rise in delayed work, some say it includes agreements for $30 billion each year beginning in 2028.
People who study businesses observed something. Piper Sandler now suggests buying Oracle stock. They observed a rise in IT leaders’ plans to spend more on Oracle cloud services. Currently, 27% intend to boost their spending a lot, a jump from 15% the previous year. This change shows Oracle is becoming a strong competitor in the future of cloud technology, artificial intelligence systems. They are moving away from being a traditional software company.
Market and Leadership Impact
Money problems affect more than just this business, impacting others as well. Larry Ellison, who started Oracle, now has more money than anyone else, even Elon Musk. He now has $393 billion, mostly because his company’s stock price increased after people learned about a buildup of orders for artificial intelligence technology.
Experts believe this news might change how people view Oracle within the tech world forever. The company wasn’t known for cloud work for a long time, falling behind Amazon, Microsoft. The growth of artificial intelligence changed things, so Oracle can now use its strong relationships with businesses, active collaborations, a large amount of money toward building systems.
TV expert Jim Cramer thinks the large increase in orders probably happened because of the Stargate project. He wondered aloud if major artificial intelligence companies were behind it. He described the outcome as a really important turning point for Oracle, also for the entire cloud computing industry.
Problems still exist. Creating, running large data centers for artificial intelligence needs a lot of money. Oracle needs to show they can finish the work when promised, with the amount of capacity they plan. Other companies will probably respond. Microsoft, Amazon, Google likely will invest even more in their own artificial intelligence systems.
Right now, Oracle’s earnings changed how people talk about competition in cloud services. The market, which seemed full, now has opportunities. Oracle is taking the lead at a key time for artificial intelligence development. The business might truly bounce back if it starts making consistent income from its current orders. This would show its investment in artificial intelligence technology was a smart move.
