"AI Landing", Oracle's (ORCL.US) OCI business continues to take off

Zhitong Finance learned that Oracle (ORCL.US) will announce its first-quarter fiscal 2025 earnings after the US stock market closes on Monday. Investors may focus on the growth of cloud infrastructure. According to Visible Alpha, analysts expect the software giant's revenue to be $13.23 billion, up more than 6% year-on-year; and expect earnings per share to be 91 cents, up from 86 cents in the same period last year; and expect net profit to be $2.57 billion.

Key Indicators: Oracle Cloud Infrastructure Revenue

Oracle's stock price hit a record high in June when the company announced cloud infrastructure deals with Microsoft (MSFT.US), OpenAI and Alphabet's Google (GOOGL.US) while reporting its fourth-quarter earnings. The stock price fell slightly last Friday, up about 35% so far this year.

Oracle's cloud infrastructure (OCI) generated $2 billion in revenue last quarter, and the company expects a more than 50% year-on-year growth in fiscal 2025. According to Visible Alpha, analysts on average expect the company's OCI business to generate $2.18 billion in revenue this quarter, up 44% year-on-year. Morgan Stanley analysts wrote last month that the scarcity of AI hardware is driving "business demand" for OCI.

Analysts at Jefferies said that if Oracle wants to achieve double-digit revenue growth, the company will need to see sustained OCI demand and increased OCI capacity.

Business Focus: Partnerships

Last quarter, Oracle said it may be well-positioned to benefit from growing data needs to train and run artificial intelligence models, especially its contracts with Microsoft and OpenAI. The analyst at Mizuho Americas expects Oracle to announce a partnership with Amazon's (AMZN.US) cloud services division AWS at the Oracle CloudWorld conference from September 9 to 12. The company also said that Oracle may announce a plan for a new artificial intelligence factory.