Oracle’s Cloud Infrastructure (OCI) is thriving, significantly exceeding expectations, particularly driven by key projects like the Stargate joint venture and its vast Texas datacenter. A crucial yet often overlooked growth factor is Oracle’s partnership with ByteDance, which has positioned Johor, Malaysia, as a major AI hub. This collaboration is set to expand globally, further enhancing Oracle’s market presence. The company anticipates over $130 billion in contracts over the next year, supported by strong demand across various sectors, including larger and smaller firms. Larry Ellison’s strategic investments in AI and HPC have cemented Oracle’s status as a leading player in AI computing. Additionally, Oracle’s competitive advantages, particularly in networking and capital costs, bolster its profitability against rivals. While the Stargate contract with OpenAI promises substantial earnings, questions remain regarding Oracle’s long-term financial sustainability and its ability to upsell higher-margin services amidst rising competition.
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