How AMD, Nvidia, Broadcom Can Ride Oracle's $455B Cloud Surge

Core Insights - Oracle's remaining performance obligations (RPO) for its cloud division increased by 359% year-over-year, reaching $455 billion, leading to a nearly 36% rise in its stock price [2] - The company anticipates securing additional multi-billion-dollar customers, potentially pushing RPO beyond $500 billion in the near future [2] Group 1: Infrastructure and Capital Expenditure - Oracle's ability to convert RPO into revenue depends on expanding its infrastructure, which requires electricity, regulatory approvals, and high-performance GPUs, all of which are currently in short supply [3] - The company raised its capital expenditure projection to $35 billion for fiscal 2026, a 65% increase, emphasizing the urgency of its AI infrastructure expansion [3] Group 2: Partnerships and Hardware Strategy - Oracle has a strong partnership with Nvidia, utilizing its GPUs in Oracle Cloud Infrastructure, and offers "bare metal" instances for optimized performance [4] - Oracle is diversifying its hardware options by collaborating with AMD, planning to deploy up to 131,072 MI355X GPUs, which provide more than double the price-performance of previous generations [6] Group 3: AI Inference and Custom Chips - Oracle's revenue outlook is increasingly tied to AI inference, which is expected to create a recurring demand stream, benefiting companies like Broadcom that produce custom application-specific integrated circuits (ASICs) [7] - As AI transitions from development to widespread use, the demand for inference workloads is anticipated to exceed training requirements, leading to a greater role for ASICs in Oracle's operations [7]