Oracle(US:ORCL) 美股IPO·2025-12-11 13:00Core Viewpoint - Oracle's recent financial report has sparked significant discussion on Wall Street, highlighting a substantial reliance on non-recurring income to inflate profits, despite a record backlog of $523 billion in orders and a notable increase in non-GAAP EPS [1][3][8] Financial Performance - Oracle reported a non-GAAP EPS of $2.26, significantly exceeding market expectations of $1.65, primarily due to $2.7 billion in non-recurring income from the sale of its stake in Ampere [8] - The company's total revenue grew by 13% year-over-year, slightly below market expectations, with cloud infrastructure revenue at $4.079 billion, a 66% increase, but still below UBS's forecast of 68% growth [7][8] Order Backlog and Conversion Concerns - The order backlog reached a record high of $523 billion, with a $67.7 billion increase in the quarter, reflecting a year-over-year surge of 583% in implied order value, driven by AI-related purchases from major clients like Meta and Nvidia [6][8] - Despite the impressive order growth, concerns are rising regarding the conversion of these orders into sustainable revenue, with analysts noting a lack of confidence in the company's ability to translate order volume into profits [7][10] Capital Expenditure and Cash Flow - Oracle's capital expenditures soared to $12 billion, more than doubling year-over-year, leading to a negative free cash flow of -$10 billion [8][9] - The management has raised the capital expenditure target for FY2026 to $50 billion, which is 75% of the expected annual revenue, indicating a significant investment in AI infrastructure [8][9] Market Reactions and Analyst Ratings - Following the earnings report, Oracle's stock price fell over 10%, prompting several investment banks, including UBS and Morgan Stanley, to lower their target prices or reassess their ratings [5][10] - UBS maintained a "Buy" rating but reduced the target price from $380 to $325, while Bank of America also retained a "Buy" rating, lowering its target from $368 to $300 [10][11] Valuation and Future Outlook - The valuation logic for Oracle has shifted from a premium based on order potential to a discount reflecting conversion risks, with analysts emphasizing the need for clearer signals of revenue growth and improved profit margins [10][12] - Discrepancies in valuation perspectives stem from differing views on Oracle's potential for AI transformation, with some analysts optimistic about the long-term potential of the $523 billion backlog, while others call for more concrete evidence of profitability improvements [12][14]