Oracle(US:ORCL) GUOTAI HAITONG SECURITIES·2025-09-12 11:54Investment Rating - The report maintains a "Buy" rating for Oracle, with a target price adjusted to $364 [12][21]. Core Insights - Oracle has experienced a surge in large customer orders, leading to a significant increase in Remaining Performance Obligations (RPO), which reached $455 billion, a year-on-year increase of 359% [12]. - The company has signed cloud contracts with major clients such as OpenAI, Meta, and XAI, driving cloud RPO growth of nearly 500% [12]. - Oracle's AI infrastructure is in high demand, with expectations of signing more multi-billion dollar contracts, potentially increasing RPO to over $500 billion [12]. - The company has significantly raised its IaaS revenue guidance for FY2026 to FY2030, forecasting revenues of $18 billion, $32 billion, $73 billion, $114 billion, and $144 billion respectively [12]. Financial Summary - Revenue projections for Oracle are adjusted to $67.4 billion, $84.9 billion, and $128.7 billion for FY2026E, FY2027E, and FY2028E respectively, with corresponding Non-GAAP net profits of $20.1 billion, $25.5 billion, and $35.0 billion [5][12]. - The company’s gross profit is expected to be $45.7 billion, $55.9 billion, and $78.7 billion for FY2026E, FY2027E, and FY2028E respectively, with gross margins declining from 67.7% to 61.1% over the same period [5]. Market Position - Oracle is transitioning from a data service provider to a data center operator, rapidly climbing the ranks among leading cloud vendors [12]. - The company is leveraging its existing customer base in databases to enhance its position in the enterprise AI inference market [12]. Industry Outlook - The AI industry is projected to maintain a high growth trajectory, with infrastructure spending expected to reach $3-4 trillion by 2030 [12]. - Major companies like Meta and Microsoft are making substantial investments in AI infrastructure, indicating a robust market environment for Oracle [12].