Oracle (ORCL) Stock: Is Now the Time to Bet on AI-Driven Cloud Growth and Strategic Partnerships?

In the ever-shifting landscape of technology, Oracle (ORCL) has emerged as a quiet but formidable force in the AI and cloud computing race. With its recent strategic moves—ranging from a multibillion-dollar partnership with OpenAI to its central role in the TikTok deal—Oracle is positioning itself not just as a player, but as a critical infrastructure provider for the next phase of digital transformation. For investors, the question is no longer whether Oracle is relevant, but whether the company's current trajectory offers a compelling opportunity to capitalize on AI-driven growth and geopolitical tailwinds.

The AI and Cloud Infrastructure Play

Oracle's cloud business has been a revelation in 2025. According to a report by Capitoltrades, the company's Remaining Performance Obligations (RPO) have surged to over $450 billion, providing a clear line of sight into future revenue streamsOracle’s Rally Fueled by AI, Cloud, Capitol Hill, and TikTok^[1]. This growth is fueled by a dual focus on AI infrastructure and cloud scalability. The “Stargate” initiative, a partnership with OpenAI, underscores Oracle's commitment to building a robust foundation for AI workloads. By integrating OpenAI's models with Oracle's cloud infrastructure, the company is not only securing a key role in the AI ecosystem but also differentiating itself from rivals like AWS and Microsoft, which are already saturated in the marketOracle’s Rally Fueled by AI, Cloud, Capitol Hill, and TikTok^[1].

Financially, Oracle's cloud revenue grew 27% year-over-year in Q2 2025, outpacing the broader market's growthOracle: Participation in the TikTok Deal Secures Business from …^[4]. While AWS and Microsoft dominate the global cloud market with 30% and 20% shares respectively, Oracle's 3% share—though modest—has shown resilience. Analysts at Morningstar note that Oracle's focus on AI-specific infrastructure, including its autonomous database and high-performance computing capabilities, is attracting clients seeking specialized solutionsOracle: Participation in the TikTok Deal Secures Business from …^[4]. This niche positioning could prove critical as AI workloads become more complex and demand tailored infrastructure.

The TikTok Deal: A Strategic and Financial Windfall

Oracle's involvement in the TikTok deal is perhaps its most consequential move. As part of a consortium led by Oracle, Silver Lake, and Andreessen Horowitz, the company will manage TikTok's U.S. user data and oversee the app's algorithm, ensuring compliance with national security requirementsOracle Could Take a Stake in TikTok. Here's What Investors …^[2]. This arrangement, dubbed “Project Texas,” has been in place since 2022 but is now being formalized into a broader ownership structure. Oracle will take a minority stake in TikTok U.S., with the new entity governed by a U.S.-based board where six of seven seats will be held by AmericansOracle part of TikTok deal. What we know about US …^[3].

The financial implications are significant. TikTok's U.S. operations generated $10 billion in revenue in 2024, driven by 170 million active usersOracle Could Take a Stake in TikTok. Here's What Investors …^[2]. Oracle's expanded role—ranging from cloud infrastructure to potential advertising revenue sharing—could provide a new, diversified revenue stream. Morningstar analysts estimate that the deal secures Oracle's position as a key cloud infrastructure provider for a major customer, though the direct financial upside may be limited compared to its broader AI infrastructure growthOracle: Participation in the TikTok Deal Secures Business from …^[4]. Still, the strategic value of aligning with a platform of TikTok's scale cannot be overstated.

Competitive Positioning in the AI Cloud Race

Oracle's competitors, particularly AWS and Microsoft, have made aggressive moves in AI-specific cloud services. Microsoft, for instance, leads in AI case studies through Azure OpenAI, while Google Cloud's Ironwood TPU chips highlight its focus on AI-optimized hardwareWho is winning the cloud AI race? Microsoft vs.^[5]. However, Oracle's unique value proposition lies in its ability to offer end-to-end solutions for AI workloads, from infrastructure to database management.

Data from CRN shows that Oracle's cloud infrastructure revenue grew 49% in Q3 2025, outpacing AWS's 30% and Microsoft's 20% market sharesOracle’s Rally Fueled by AI, Cloud, Capitol Hill, and TikTok^[1]. This growth is driven by enterprises seeking to migrate workloads to Oracle's cloud, particularly in industries like healthcare and finance, where data security and compliance are paramount. The TikTok deal further reinforces Oracle's reputation as a trusted custodian of sensitive data, a critical differentiator in an era of heightened regulatory scrutiny.

Is Now the Time to Bet on Oracle?

For investors, the calculus hinges on two factors: Oracle's ability to sustain its AI and cloud growth and the potential upside from the TikTok deal. While the company's market share remains smaller than the Big Three, its RPO of $450 billion and 15%–20% annual growth projections for FY26 and FY27 suggest a durable business modelOracle’s Rally Fueled by AI, Cloud, Capitol Hill, and TikTok^[1]. The TikTok partnership, meanwhile, offers both strategic and financial tailwinds, particularly as U.S. regulators continue to prioritize data sovereignty.

However, risks remain. The TikTok deal is subject to regulatory approval, and geopolitical shifts could alter the landscape. Additionally, Oracle's cloud business faces stiff competition from AWS and Microsoft, which have deeper ecosystems and broader client bases. That said, Oracle's focus on AI infrastructure and its proven ability to execute complex partnerships—such as Stargate and Project Texas—position it as a compelling long-term play.

Conclusion

Oracle's strategic bets in AI and cloud computing, coupled with its pivotal role in the TikTok deal, paint a picture of a company that is not only adapting to industry trends but actively shaping them. For investors willing to look beyond short-term volatility, Oracle offers a unique combination of infrastructure expertise, regulatory alignment, and growth potential. As the AI-driven economy accelerates, the question is no longer whether Oracle can compete—it's whether it can outpace its rivals in a market where infrastructure is king.