Oracle Poised for Growth with Surging AI Data Center Demand

Oracle is on a promising growth trajectory. Its cloud revenue surged 49% in Q3, showcasing its dominance in AI data centers. As demand outpaces supply, Oracle could soon join the elite $1 trillion club, making it a strong investment opportunity.

Date: 16-03-2025

AI Rating: 7

Earnings and Revenue Growth

Oracle generated earnings per share (EPS) of $4.26 over the last four quarters, and Wall Street estimates suggest EPS could rise to $6.78 in fiscal 2026. This projected growth indicates a potential increase of 13%. Furthermore, Oracle's revenue during the fiscal 2025 third quarter totaled $14.1 billion, with its Oracle Cloud Infrastructure (OCI) segment experiencing a remarkable 49% increase year over year. This constitutes the fastest-growing segment of the company.

Future Revenue Growth Potential

Though Oracle's total revenue increased by just 6%, the demand for AI data centers outstrips supply significantly. Oracle's remaining performance obligations (RPOs) soared by 63% to a record high of $130 billion, suggesting a strong future revenue stream. The company's leadership anticipates OCI revenue growth to exceed 50% for the full fiscal year, indicating robust potential moving forward.

Profits and Cost Savings

The increased use of automation in its data centers is expected to enhance Oracle's profit margins due to reduced operational costs. This development could lead to higher EPS and overall growth as the OCI business scales.

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In summary, Oracle's impressive revenue growth, particularly in its cloud services, combined with forecasts of growing EPS and improved profit margins, make it a compelling investment opportunity for those looking to gain exposure to the expanding AI sector.

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