Oracle's Longtime Chief Security Officer Mary Ann Davidson Leaves Amid Reorganization

Oracle's Chief Security Officer, Mary Ann Davidson, is leaving the company after nearly four decades. She was a key player in shaping Oracle's product security policies and developed industry-leading security practices. The timing of her exit comes as Oracle cuts costs to pour resources into AI infrastructure. Analysts have a Moderate Buy consensus rating on ORCL stock, with an average price target of $248.79 per share.

Oracle Corp. is undergoing significant changes in its leadership and workforce, with the departure of longtime Chief Security Officer Mary Ann Davidson and recent job cuts in its cloud division. Davidson, who joined Oracle in 1988 after serving in the U.S. Navy, is leaving the company after nearly four decades, according to a Bloomberg report [1]. Her exit comes as Oracle seeks to control costs amid heavy investments in AI infrastructure.

Davidson played a pivotal role in shaping Oracle's product security policies and developed industry-leading security practices. She was known for her rigorous approach to securing Oracle's code and her close advisory role to Oracle co-founder Larry Ellison. However, her strong stance on product security led to controversy in 2015 when she criticized customers for independently testing Oracle products for vulnerabilities, arguing it violated licensing agreements. Oracle later disavowed her blog post on the matter [1].

The timing of Davidson's departure coincides with Oracle's cost-cutting measures. The company has announced job cuts in its cloud division, with over 150 positions eliminated in the Seattle area alone [2]. This move follows similar cost-control measures taken by other tech giants such as Microsoft, Amazon, and Meta. Oracle's spokesperson did not respond to multiple requests for comment, but the company has previously stated that it periodically makes changes to its workforce due to strategy changes, reorganizations, or performance issues [2].

Despite the stock being near an all-time high, driven by momentum in the cloud unit, Oracle faces significant expenses to build out increasingly large server farms to meet demand. The company's free cash flow was negative in the fiscal year that ended in May. Oracle has been investing heavily in AI infrastructure, as seen in its recent deal with OpenAI for about 4.5 gigawatts of data center power in the US [2].

Analysts have a Moderate Buy consensus rating on ORCL stock based on 24 Buys, 10 Holds, and zero Sells assigned in the past three months, with an average price target of $248.79 per share [3]. This suggests that shares are trading at fair value.

References:
[1] https://finance.yahoo.com/news/oracle-longtime-security-chief-leaves-162604560.html
[2] https://www.ainvest.com/news/oracle-reduces-cloud-division-jobs-ai-infrastructure-spending-surge-2508/
[3] https://www.tipranks.com/news/oracles-orcl-chief-security-officer-is-leaving-the-company