Oracle's $3.5B Volume Slump to 20th as Cloud Cuts Spur Market Jitters

Oracle (ORCL) fell 3.81% on Wednesday, with a trading volume of $3.51 billion, ranking 20th in market activity. The decline followed reported layoffs in its cloud infrastructure division, according to Bloomberg, citing unnamed sources. Cuts reportedly targeted U.S. and India operations for Oracle Cloud Infrastructure (OCI), though the exact number remains undisclosed. The move contrasts with cost-cutting strategies at peers like Microsoft and Amazon in other business segments.

The stock broke below its 21-day moving average for the first time since its April rally, which had driven shares up over 45% year-to-date. The layoffs come amid Oracle’s significant investments in AI-related data center infrastructure, including a recent agreement to develop 4.5 gigawatts of capacity for OpenAI. However, the job cuts signal potential internal restructuring as the company navigates competitive pressures in the cloud computing sector.

Investor sentiment may also have been influenced by CoreWeave’s earnings report earlier in the week, which highlighted persistent data center capacity constraints. Despite the broader AI-driven demand, Oracle’s stock performance underscores market caution ahead of its next earnings release and strategic updates.

A backtest of a strategy buying the top 500 stocks by daily trading volume from 2022 to present showed a compound annual growth rate of 6.98%, with a maximum drawdown of 15.46%. The approach demonstrated steady growth but faced significant volatility in mid-2023, emphasizing the need for risk management in high-turnover trading strategies.