Oracle issued a bullish forecast on RPOs, or bookings. ORCL stock surged from around $240 to a high of $345.72. Last week, shares closed at $291.31.
On October 17, the firm issued a glowing forecast at analyst day. It expects $225 billion in revenue in fiscal year 2030. To get there, CAGR needs to grow by 31%. Analysts reacted, with Piper Sandler raising its price target to $380, up from $330.
Co-CEO Clay Magouyrk split the costs of an AI build between land, data center, and power. That included the buildings that generate power. That accounted for 35% of the service cost. Compute, networking, and storage account for approximately 65% of costs.
Risks
Oracle’s revenue forecast depends heavily on one customer. This increases the risk of the firm not meeting expectations should the customer cut its demand. OpenAI accounts for around two-thirds of the $500 billion in backlog.
On Oct. 14, Oracle announced a partnership with AMD (AMD). It would deploy 50,000 AMD-powered AI servers starting in the second half of 2026.
Your Takeaway
For now, few doubt that Oracle will disappoint shareholders. The short interest is 0.65% even though the stock’s P/E is 67 times.
/Technology%20abstract%20by%20TU%20IS%20via%20iStock.jpg)
