Oracle Shares Dip After Record AI Surge Despite Strong Cloud Momentum
Oracle Corporation (ORCL.N) saw a drop in its share price on Thursday, following a historic surge driven by artificial intelligence-related gains the day before. This recent rally brought the company closer to the trillion-dollar valuation mark and placed co-founder Larry Ellison near the top of the world’s wealth rankings.
AI-Driven Growth Fuels Market Buzz
The software giant has recently secured several multi-billion-dollar cloud computing deals, boosting investor confidence. These deals reflect the growing demand for computing power, as companies worldwide race to dominate in AI technologies.
On Wednesday, Oracle’s stock soared by as much as 35.9%, pushing its market valuation to a record $933 billion by the close of trade. However, Thursday’s pullback of around 4% may bring the valuation down to nearly $894 billion, depending on market movements.
Ellison, who owns 41% of Oracle, now has an estimated net worth of $371.7 billion. While this places him among the richest individuals globally, he still trails behind Elon Musk, whose fortune is estimated at $441.2 billion.
Investors Show Caution After Rally
Commenting on the stock retreat, Dennis Dick, chief strategist at Stock Trader Network, noted, “A bit of buyer exhaustion here. I think the ‘buy the dip’ crowd is likely to re-emerge. The guidance was so incredible, hard to think that this story is over.”
Oracle recently announced its order backlog could reach $500 billion in the coming months, underscoring the company’s strong outlook. Meanwhile, The Wall Street Journal reported that OpenAI has entered a $300 billion deal with Oracle for computing services, marking one of the largest agreements of its kind.
Oracle Outperforms S&P 500 and Tech Rivals
Oracle’s stock has nearly doubled in value in 2025, outperforming the broader S&P 500 index and even the high-flying Magnificent Seven stocks. The current median price target for Oracle shares is $342, representing a potential 9% upside from its latest trading price of $314.45, according to LSEG data.
Despite this, Oracle shares are trading at a premium compared to its cloud competitors. Its 12-month forward price-to-earnings ratio stands at 45.3, compared with Amazon’s 31.3 and Microsoft’s 31.
with inputs from Reuters