Oracle is currently in the spotlight, especially with potential involvement in TikTok’s U.S. operations and a surge in deals. However, skepticism surrounds the company’s rapid market valuation increase, largely influenced by OpenAI obligations. While securing TikTok is beneficial, the excitement around Oracle’s $455 billion backlog—primarily stemming from OpenAI—could be overstated as many of these obligations extend to 2027-2030. This has led to a market value rise of $400 billion based on a projected $30 billion profit from a $300 billion deal, which seems disproportionate against Oracle’s current revenue of $12 billion. Additionally, the transition from Safra Catz to two co-CEOs raises questions about leadership effectiveness. Yet, Catz’s transformation of Oracle into a significant cloud contender showcases her impact. The new leaders have proven experience, but the focus should remain on fulfilling those ambitious commitments as the market remains cautious.
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