Cloud Margins & Profitability Concerns - Oracle's cloud margins, tied to AI infrastructure buildout, are predicted to be lower than Wall Street expectations [1] - Concerns about long-term profitability are resurfacing, despite a 529% increase in Remaining Performance Obligation (RPO) [2] - Analysts are questioning the return on investment and long-term profitability picture for Oracle's cloud business [3] - The market is scrutinizing when the profitability picture will improve in the long term [7] Capital Expenditure & Power Consumption - The cost of Nvidia chips and the capital-intensive nature of building data centers (including power and labor) are impacting cloud margins [2] - The source of power for Oracle's data centers is a key question [5] - The market anticipates that the capital intensity of power consumption for data centers will decrease over time [8] Market Reaction & Valuation - A tech research report ("the information") triggered a stock movement of 5% for Oracle [1] - The market seems to be less focused on margins, with a report referring to 900 million in sales and 125 million in profit, resulting in approximately 14% gross margin [9] - The market is getting concerned about whether giant deals will materialize and deliver on their promises [13] - Some investors are reducing exposure to companies involved in AI, choosing to take profits [15] Oracle's Strategy & Future Outlook - Oracle is positioning itself as a key enabler in the AI workload space, necessitating increased capital expenditure [6] - Oracle World in Las Vegas will address financial questions about profitability and the Open AI partnership [4] - Oracle is transitioning from a highly profitable software business (60-70% margins) to Oracle Cloud Infrastructure (OCI), with margins in the mid-20s or lower [10]