Oracle(US:ORCL) The Motley Fool·2024-12-14 08:25Company Performance - Oracle's stock has gained 80% year-to-date but dropped over 8% in pre-market trading after Q2 FY2025 earnings missed Wall Street expectations [1][2] - Q2 FY2025 revenue increased 9% YoY to $14.1 billion, with non-GAAP earnings up 10% to $1.47 per share, slightly below analyst estimates of $14.11 billion and $1.48 per share [4] - Cloud infrastructure revenue surged 52% YoY to $2.4 billion, driven by record AI demand [7] - Remaining performance obligations (RPO) grew 50% YoY to $97 billion, indicating strong future revenue potential [6] Cloud Infrastructure Growth - Oracle's cloud infrastructure consumption powered by Nvidia GPUs increased 336% last quarter [8] - The company is expanding its cloud infrastructure with 35 planned cloud regions for major providers like Microsoft Azure, Google Cloud, and Amazon Web Services [8] - Oracle is growing faster than the overall cloud IaaS market, gaining market share [10] Industry Outlook - Gartner forecasts cloud infrastructure spending to grow 25% in 2025 to $212 billion, up from 21% growth this year [9] - Goldman Sachs predicts the cloud IaaS market will generate $580 billion in revenue by 2030, more than double next year's expected revenue [13] Investment Opportunity - Oracle's stock is trading at 30 times forward earnings, a discount to the Nasdaq-100's multiple of 34 [14] - Analysts expect Oracle's earnings to grow 13% in FY2025 to $6.28 per share and another 13% in FY2026 to $7.12 per share [11] - The company's strong RPO growth and cloud infrastructure expansion position it well for future growth [12]