Oracle Stock Up On Deals With OpenAI, Microsoft, Google Amid Strong AI Demand

RTTNews | 299 days ago
Oracle Stock Up On Deals With OpenAI, Microsoft, Google Amid Strong AI Demand

(RTTNews) - Oracle Corp. shares gained around 10 percent in the extended trading on Tuesday on the NYSE after the tech major announced artificial intelligence or AI cloud infrastructure partnerships with Microsoft, ChatGPT maker OpenAI, and Alphabet's Google Cloud.

While announcing fourth-quarter results, the company also said it expects continued strong AI demand throughout fiscal year 2025 to push Oracle sales and RPO even higher and result in double-digit revenue growth. This was despite reporting quarterly earnings and revenues below market estimates.

In a statement, Oracle, Microsoft, and OpenAl said they are partnering to extend the Microsoft Azure Al platform to Oracle Cloud Infrastructure or OCI to provide additional capacity for OpenAl.

AI research and development company OpenAI is the developer of ChatGPT, which provides generative AI services to more than 100 million users every month.

Larry Ellison, Oracle Chairman and CTO, said, "The race to build the world's greatest large language model is on, and it is fueling unlimited demand for Oracle's Gen2 AI infrastructure. Leaders like OpenAI are choosing OCI because it is the world's fastest and most cost-effective AI infrastructure."

Sam Altman, Chief Executive Officer, OpenAI, added that OCI will extend Azure's platform and enable OpenAI to continue to scale.

Under the deal, OpenAI will join thousands of AI innovators across industries around the world that run their AI workloads on OCI AI infrastructure. Oracle noted that Adept, Modal, MosaicML, NVIDIA, Reka, Suno, Together AI, Twelve Labs, xAI, and others use OCI Supercluster to train and inference next-generation AI models.

Separately, Oracle and Google Cloud announced a partnership, under which customers can combine OCI and Google Cloud technologies to help accelerate their application migrations and modernization.

Google Cloud will offer OCI database services and high-speed network interconnect with Oracle. Google Cloud's Cross-Cloud Interconnect will be initially available for customer onboarding in 11 global regions. Later this year, a new offering, Oracle Database@Google Cloud, will be available with the highest level of Oracle database and network performance, along with feature and pricing parity with OCI.

Oracle's latest deals were announced despite weak fourth-quarter trading performance. Oracle's net profit decreased from last year to $3.14 billion, or $1.11 per share on a reported basis, and $4.61 billion or $1.63 per share on an adjusted basis, which missed the Street estimates.

The company's revenue for the quarter rose 3.3 percent to $14.29 billion, but fell short of market view.

Oracle shares closed Tuesday's regular trading at $123.88, down 0.50 percent. In the after-hours trading, the shares gained 9.5 percent to trade at $135.60.

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