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1. Company Snapshot

1.a. Company Description

Oracle Corporation offers products and services that address enterprise information technology environments worldwide.Its Oracle cloud software as a service offering include various cloud software applications, including Oracle Fusion cloud enterprise resource planning (ERP), Oracle Fusion cloud enterprise performance management, Oracle Fusion cloud supply chain and manufacturing management, Oracle Fusion cloud human capital management, Oracle Advertising, and NetSuite applications suite, as well as Oracle Fusion Sales, Service, and Marketing.The company also offers cloud-based industry solutions for various industries; Oracle application licenses; and Oracle license support services.


In addition, it provides cloud and license business' infrastructure technologies, such as the Oracle Database, an enterprise database; Java, a software development language; and middleware, including development tools and others.The company's cloud and license business' infrastructure technologies also comprise cloud-based compute, storage, and networking capabilities; and Oracle autonomous database, MySQL HeatWave, Internet-of-Things, digital assistant, and blockchain.Further, it provides hardware products and other hardware-related software offerings, including Oracle engineered systems, enterprise servers, storage solutions, industry-specific hardware, virtualization software, operating systems, management software, and related hardware services; and consulting and customer services.


The company markets and sells its cloud, license, hardware, support, and services offerings directly to businesses in various industries, government agencies, and educational institutions, as well as through indirect channels.Oracle Corporation was founded in 1977 and is headquartered in Austin, Texas.

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1.b. Last Insights on ORCL

Oracle's recent decline is attributed to investor concerns over the high costs and potential margin pressure from its aggressive expansion into AI cloud infrastructure. The company's soaring debt and execution risks associated with AI investments have also impacted its performance. Analysts at Jefferies highlight a favorable risk versus reward profile following the stock pullback, with a 'Buy' rating and $400 price target. Key risks include a high debt-to-equity ratio and negative free cash flow.

1.c. Company Highlights

2. Oracle's Strong Q1 FY2026 Earnings Driven by Cloud and AI Growth

Oracle reported a robust start to fiscal year 2026, with total cloud revenue growing 27% to $7.2 billion, driven by a 54% year-over-year increase in cloud infrastructure revenue to $3.3 billion. The company's remaining performance obligations (RPO) reached $455 billion, a 359% increase year-over-year. Oracle's actual EPS came out at $1.47, slightly below estimates of $1.48. The company's guidance for Q2 includes total revenue growth of 12% to 14% in constant currency and total cloud revenue growth of 32% to 36% in constant currency.

Publication Date: Sep -09

📋 Highlights
  • Surging RPO Growth: Remaining performance obligations reached $455 billion, a 359% YoY increase and a $317 billion jump quarterly.
  • Cloud Infrastructure Revenue: Grew to $3.3 billion, up 54% YoY, driven by AI workloads and gigawatt-scale data centers.
  • Multi-Cloud Database Surge: Revenue jumped 1,529% to $790 million, reflecting strong demand for hybrid cloud solutions.
  • OCI Growth Projections: Oracle Cloud Infrastructure revenue targets $18 billion in FY2026 (77% growth) and $144 billion by FY2030.
  • Q2 Revenue Guidance: Total revenue expected to grow 12–14% YoY, with cloud revenue up 32–36% in constant currency.

Cloud and AI Driving Growth

Oracle's success is largely attributed to its dominance in AI, with its cloud infrastructure becoming the go-to platform for AI training and inferencing workloads. The company's new AI database allows for vectorized data storage, further enhancing its AI capabilities. Safra Catz emphasized the company's focus on delivering value through its unique technology and infrastructure, noting that Oracle's large-scale consumption of networking equipment and GPUs allows for better financing terms and cost optimization.

Valuation and Outlook

With a P/E Ratio of 54.44 and a P/S Ratio of 11.82, Oracle's valuation suggests that the market is pricing in significant growth expectations. The company's ROE of 80.61% and ROIC of 10.87% indicate strong profitability. Oracle expects fiscal year 2026 total revenue growth of 16% in constant currency, with cloud infrastructure revenue projected to grow 77% to $18 billion. Analysts estimate next year's revenue growth at 17.1%. Oracle's focus on AI, coupled with its cloud infrastructure expertise, positions the company well for future growth and profitability.

Key Drivers of Future Growth

Oracle's Oracle Cloud at Customer offering provides a complete, private cloud solution at a competitive price, addressing security and data privacy concerns. The company's AI Application Generators enable rapid development and deployment of sophisticated applications, potentially leading to a competitive advantage. The upcoming Oracle AI database is expected to drive significant demand as enterprises seek to utilize AI for their data analytics and decision-making processes.

3. NewsRoom

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Dow Jones Today: Major Stock Indexes Little Changed; Weekly Jobless Claims Unexpectedly Fall; Inflation Data on Tap Tomorrow

Dec -04

Source: investopedia.com

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Oracle Stock's AI Gamble: Path To A 30% Rally

Dec -04

Source: forbes.com

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Sam Altman Tried to Build a Rocket Empire--And No One Noticed

Dec -04

Source: gurufocus.com

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Can Oracle Stock Reverse Its Skid? Two Factors To Watch With Earnings Due Soon.

Dec -04

Source: investors.com

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Oracle stock sentiment ‘has quickly deteriorated.' Can earnings brighten the mood?

Dec -04

Source: marketwatch.com

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Prediction: 3 Beginner Stocks That Could Turn Small Bets Into Big Fortunes

Dec -04

Source: fool.com

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Oracle Q2 Earnings Preview: Focus On The Cocktail Of Debt, Cash Flows, And OpenAI

Dec -04

Source: seekingalpha.com

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Microsoft (NASDAQ: MSFT) Stock Price Prediction for 2025: Where Will It Be in 1 Year

Dec -04

Source: 247wallst.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.54%)

6. Segments

Cloud and License

Expected Growth: 6.4%

Oracle’s Cloud and License segment is driven by increasing demand for cloud-based services and licenses for its software products, growth in emerging markets, and expanding partner networks.

Services

Expected Growth: 8.5%

Oracle's Services segment growth is driven by increasing demand for digital transformation, cloud adoption, and the need for effective implementation and support of its software and hardware products.

Hardware

Expected Growth: 5.1%

Oracle Hardware’s growth is driven by increasing demand for cloud infrastructure, need for high-performance computing, and growing adoption of big data analytics, as well as Oracle’s strong brand recognition and continued innovation in servers, storage, and networking equipment.

7. Detailed Products

Oracle Autonomous Database

A cloud-based relational database that uses machine learning to automate administrative tasks, providing high performance, security, and scalability.

Oracle Cloud Infrastructure (OCI)

A comprehensive cloud platform that provides a range of services, including compute, storage, networking, and database, for building, deploying, and managing applications.

Oracle Enterprise Resource Planning (ERP) Cloud

A comprehensive ERP system that provides a range of modules, including financial management, human capital management, and supply chain management, to manage business operations.

Oracle Customer Experience (CX) Cloud

A suite of cloud-based applications that provide a range of customer experience management capabilities, including sales, marketing, and customer service.

Oracle NetSuite ERP

A cloud-based ERP system that provides a range of modules, including financial management, inventory management, and order management, to manage business operations.

Oracle Data Science

A cloud-based platform that provides a range of data science tools and services, including machine learning, data preparation, and model deployment.

Oracle Integration Cloud

A cloud-based integration platform that provides a range of integration tools and services, including API management, data integration, and process automation.

Oracle Security and Identity

A suite of security and identity management solutions that provide threat detection, identity governance, and access management capabilities.

8. Oracle Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Oracle's products and services have a high switching cost, making it difficult for customers to switch to substitutes.

Bargaining Power Of Customers

Oracle's customers have some bargaining power due to the availability of alternative products and services, but Oracle's strong brand and customer loyalty mitigate this power.

Bargaining Power Of Suppliers

Oracle has a diverse supplier base, and no single supplier has significant bargaining power over the company.

Threat Of New Entrants

The technology industry has high barriers to entry, and new entrants would need significant resources and expertise to compete with Oracle.

Intensity Of Rivalry

The technology industry is highly competitive, and Oracle faces intense rivalry from established players such as Microsoft, SAP, and IBM.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 98.31%
Debt Cost 4.16%
Equity Weight 1.69%
Equity Cost 9.05%
WACC 4.24%
Leverage 5814.97%

11. Quality Control: Oracle Corporation passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Oracle

A-Score: 4.9/10

Value: 2.2

Growth: 6.8

Quality: 6.0

Yield: 2.0

Momentum: 9.0

Volatility: 3.3

1-Year Total Return ->

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Stock-Card
Zscaler

A-Score: 4.9/10

Value: 2.0

Growth: 8.4

Quality: 4.6

Yield: 0.0

Momentum: 9.0

Volatility: 5.3

1-Year Total Return ->

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Stock-Card
CrowdStrike

A-Score: 4.8/10

Value: 2.0

Growth: 8.8

Quality: 4.8

Yield: 0.0

Momentum: 9.0

Volatility: 4.3

1-Year Total Return ->

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Stock-Card
Fortinet

A-Score: 4.8/10

Value: 0.8

Growth: 9.1

Quality: 8.5

Yield: 0.0

Momentum: 5.5

Volatility: 4.7

1-Year Total Return ->

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Stock-Card
Adobe

A-Score: 4.7/10

Value: 3.0

Growth: 7.7

Quality: 9.0

Yield: 0.0

Momentum: 1.5

Volatility: 7.3

1-Year Total Return ->

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Stock-Card
Synopsys

A-Score: 3.7/10

Value: 0.9

Growth: 7.3

Quality: 7.2

Yield: 0.0

Momentum: 3.5

Volatility: 3.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

214.33$

Current Price

214.33$

Potential

-0.00%

Expected Cash-Flows