Oracle(US:ORCL) Jin Rong Jie·2025-12-11 15:21Group 1 - Oracle's stock dropped over 13% to $193.84 following its Q2 earnings report, which showed a 14% revenue growth to $16.1 billion, aligning closely with market expectations [1] - The adjusted earnings per share (EPS) of $2.26 exceeded market expectations, while cloud computing sales grew by 34% to $7.98 billion, and infrastructure revenue surged by 68% to $4.08 billion, although both figures were slightly below analyst forecasts [1] - A significant factor in profit growth was a $2.7 billion pre-tax gain from the sale of shares in chip manufacturer Ampere Computing, but this one-time gain raised concerns about the sustainability of core business profitability and cash flow [1] Group 2 - Despite the record backlog of cloud computing orders at $523 billion, concerns arose regarding the actual conversion of these orders into profits, as the growth rate of cloud business was below expectations [2] - Increased capital expenditures led to negative free cash flow, contributing to the sharp decline in Oracle's stock price post-earnings report [2] - Major financial institutions like UBS and Bank of America quickly downgraded Oracle's target price, while Morgan Stanley placed the stock under "cautious review," indicating a shift in market focus towards the quality of earnings and the realization of backlog orders [2]