Earnings Watch: Will Oracle Stock Regain Its Bullish Momentum?

Transforming from a legacy database company into a major AI compute provider, Oracle ORCL stock has spiked over +30% in 2025 due to surging demand for its cloud and AI infrastructure services, massive new partnerships, and sharply upgraded revenue forecasts.With Oracle Cloud Infrastructure (OCI) and Oracle Cloud Applications (OCA) riding the AI boom, it’s certainly a worthy topic of whether it's time to buy ORCL as the company's  fiscal second quarter results approach after-market hours on Wednesday, November 10.To that point, despite the pleasant year-to-date returns and being one of the market’s top post-pandemic performers, ORCL has fallen 36% from its 52-week and all-time high of $345 a share, which it hit this September.Image Source: Zacks Investment Research Oracle’s Q2 ExpectationsBased on Zacks' estimates, Oracle’s Q2 sales are thought to have increased 15% to $16.15 billion versus $14.06 billion in the comparative quarter. Taking advantage of its sales growth, Oracle’s Q2 EPS is expected to be up 11% to $1.63 from $1.47 per share a year ago. AI Cloud GrowthNotably, Oracle has shocked Wall Street as the tech giant expects cloud infrastructure revenue to climb from $18 billion this year to $144 billion over the next four years. More intriguing, analysts now believe Oracle could significantly expand its share of the cloud market after securing nearly $500 billion in AI-related commitments from OpenAI, xAI, Meta Platforms META, and TikTok.Analysts at Wells Fargo WFC in particular see OCI’s market share going from 5% to 16% by 2029, which would be a significant development as the majority of the cloud market is currently controlled by Amazon’s AMZN AWS, Microsoft's MSFT Azure, and Alphabet’s GOOGL Google Cloud. Tracking Oracle’s CapExCorrelating with the fact that Oracle could still face an uphill battle when competing against the Mag 7 tech giants for cloud dominance, scaling cloud infrastructure to meet AI demand is capital-intensive and complex. Of course, heavy CapEx means reduced buybacks and tighter free cash flow, which has historically attracted investors to Oracle stock.Still, Oracle has a solid balance sheet with over $11 billion in cash on hand, although its capital expenditures are now expected to surge to $25 billion this year compared to $2.3 billion in 2024. The jump in CapEx includes building new data centers to support hyperscale AI workloads and should help in narrowing the cloud services gap behind AWS, Azure, and Google Cloud.Image Source: Zacks Investment Research Oracle's Healthy CorrectionOptimistically, the pullback in Oracle stock may have served as a healthy correction, with ORCL now trading at 32X forward earnings compared to a one-year high of 61X. Like most of the players in the AI landscape, Oracle is commanding a nifty price to forward sales premium of 9X, although this is a retraction from a high of 13X earlier in the year. Image Source: Zacks Investment Research Bottom LineAt current levels, Oracle stock has taken some of the pressure off regarding its Q2 results and is once again positioned for more sustainable long-term gains. That said, the likelihood of ORCL regaining its blazing steam will certainly depend on the ability to reach or exceed quarterly expectations while reconfirming the plausibility of exponential cloud growth in its guidance. For now, Oracle stock lands a Zacks Rank #3 (Hold). Radical New Technology Could Hand Investors Huge GainsQuantum Computing is the next technological revolution, and it could be even more advanced than AI.While some believed the technology was years away, it is already present and moving fast. Large hyperscalers, such as Microsoft, Google, Amazon, Oracle, and even Meta and Tesla, are scrambling to integrate quantum computing into their infrastructure.Senior Stock Strategist Kevin Cook reveals 7 carefully selected stocks poised to dominate the quantum computing landscape in his report, Beyond AI: The Quantum Leap in Computing Power.Kevin was among the early experts who recognized NVIDIA's enormous potential back in 2016. Now, he has keyed in on what could be "the next big thing" in quantum computing supremacy. Today, you have a rare chance to position your portfolio at the forefront of this opportunity.See Top Quantum Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Oracle Corporation (ORCL): Free Stock Analysis Report Amazon.com, Inc. (AMZN): Free Stock Analysis Report Wells Fargo & Company (WFC): Free Stock Analysis Report Microsoft Corporation (MSFT): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report Meta Platforms, Inc. (META): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks