Oracle Corp. is shaking off its reputation as a cloud laggard after reporting a surge in artificial intelligence-driven cloud contracts. The announcement sent Oracle’s shares soaring nearly 40% on Tuesday, marking the company’s steepest single-day gain since 1992. The rally lifted Oracle’s market value to about $950 billion, placing it within reach of the trillion-dollar threshold that only a few tech giants have crossed.
The surge is being fueled by a rush from AI developers to lock in computing power. Oracle reported signing four multibillion-dollar contracts with three clients in the quarter ending Aug. 31.
“Over the next few months, we expect to sign up several additional multibillion-dollar customers and RPO is likely to exceed half-a-trillion dollars,” Oracle Chief Executive Safra Catz said on the earnings call, as cited by Reuters.
The company disclosed $455 billion in remaining performance obligations, according to The Wall Street Journal.
Then, Oracle landed one of the largest deals in cloud history: a $300 billion arrangement with OpenAI.
AI inference in focus
While cloud contracts drew much of the attention, Oracle co-founder Larry Ellison is already focused on what comes next.
He believes the real breakthrough for AI will come from inference. “Eventually, AI will change everything,” Ellison said on the earnings call, according to Benzinga. He described inference as a “multi-trillion-dollar market,” pointing to its potential in fields from robotics to drug design.
Ellison also underscored Oracle’s strength in managing enterprise data. “We’re the custodian of… millions of databases,” he noted, adding that the company is “better positioned than anybody to take advantage of inferencing.”
He highlighted Oracle’s new AI Database, which is designed to enable businesses to “vectorize” their private data and connect it with models such as ChatGPT, Gemini, and Grok. He added that millions of businesses and governments are already tapping into AI models, with inference expected to extend into factories, autonomous vehicles, agriculture, and pharmaceutical research.
‘Second-mover advantage’
Oracle executives have argued that joining the cloud race later gave the company flexibility to learn from early entrants and build a more adaptable platform. On LinkedIn, Oracle executive Eric DiRuzzo described this as a “second-mover advantage,” positioning Oracle’s infrastructure as more open and resilient than first-generation offerings.
The results appear to support this analysis. Oracle’s cloud infrastructure business is projected to grow 77% this year to $18 billion, with expectations to reach $144 billion in annual revenue by 2030.
Ripple effect across AI-linked firms
Oracle’s strong results rippled through the broader AI supply chain. Shares of Nvidia, Advanced Micro Devices, and Broadcom — all major suppliers of semiconductors for AI data centers — saw shares climb between 3% and 8.5% after Oracle’s earnings news, according to market reports.
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