Apple(US:AAPL) The Motley Fool·2024-12-14 10:15Core Insights - Oracle is rapidly emerging as a leader in building data centers for artificial intelligence (AI) development, potentially reaching a $1 trillion valuation within a decade [1][3] - The company has seen significant growth in its Oracle Cloud Infrastructure (OCI), with a 52% increase in revenue, indicating strong demand for AI infrastructure [8][9] Company Overview - Founded in 1977, Oracle has been involved in nearly every technological revolution and is now focusing on AI data center infrastructure [3] - Current market capitalization stands at $492 billion, suggesting potential for investors to double their investment if the company joins the trillion-dollar club [3] AI Infrastructure - Oracle's OCI Supercluster technology allows developers to scale up to 65,000 Nvidia H200 GPUs, the highest in the industry, with plans to expand to 131,000 Blackwell GPUs [5] - The company's RDMA technology offers faster data transfer compared to traditional Ethernet, leading to cost savings for developers [6] Revenue Growth - Total revenue for Oracle in Q2 was $14.1 billion, a 9% increase year-over-year, while OCI revenue reached a record $2.4 billion, marking a 52% increase [8] - Remaining performance obligations (RPOs) increased by 50% year-over-year to $97 billion, indicating strong future revenue potential [9] Strategic Partnerships - Oracle has partnered with Meta Platforms to shift some of its AI training workloads to Oracle's infrastructure, enhancing its position in the AI market [10][11] Financial Projections - Oracle's earnings per share (EPS) grew by 24% in Q2, the fastest pace in nearly a year, with a current P/E ratio of 43.4 [12][13] - If Oracle maintains an annual EPS growth of 7.3%, it could reach a market cap of $1 trillion within 10 years, with potential for even faster growth if EPS increases by 20% [14][15]