Oracle(US:ORCL) Jing Ji Guan Cha Bao·2025-09-18 02:57Core Insights - Oracle has recently surpassed Elon Musk to become the world's richest person, driven by a surge in its stock price and significant long-term contracts with major tech companies like OpenAI and Nvidia [2][3] - The company's success in the AI wave is attributed to its strategic choice of technology, specifically its focus on "second-generation cloud infrastructure" (OCI), which aligns well with the computational needs of large AI models [3][4] Technology and Market Position - Oracle's OCI architecture provides a competitive advantage in terms of cost-effectiveness and energy efficiency, making it well-suited for AI workloads [3] - Unlike other cloud service providers that cater primarily to developers and startups, Oracle has built a strong foundation by serving large, complex organizations such as banks and governments, establishing a trust that is difficult for competitors to replicate [3][4] Strategic Approach - Oracle has adopted a measured approach in the face of disruptive opportunities, choosing not to compete directly in the AI application space or invest heavily in developing its own large models [4] - By positioning itself as a "water, electricity, and coal" supplier in the AI ecosystem, Oracle collaborates closely with Nvidia to optimize GPU integration with its infrastructure, providing robust computational resources to various players in the market [4][5] Financial Considerations - Despite its successes, Oracle faces challenges such as a $35 billion annual capital expenditure plan that has impacted its free cash flow, necessitating efficient conversion of contract backlogs into actual revenue [5] - The company's ability to navigate these challenges while maintaining a focus on its core competencies is crucial for its continued success in the evolving tech landscape [5]