The Billion-Dollar Surge: How Oracle and Larry Ellison Stunned the AI Market

The cloud computing industry offers the highest return on investment for data center chips. This is evident as major cloud companies have been increasing their spending on these semiconductors, a trend that continued through the second quarter. Oracle, one of the top global cloud providers, recently reported strong third-quarter earnings, raising expectations for continued growth in the data center semiconductor market. This positive outlook suggests that the leading AI chip manufacturers—Nvidia, Broadcom, Advanced Micro Devices, and Intel—are likely to achieve record-breaking revenues from their data center divisions in the third quarter.

Oracle's substantial backlog of cloud service contracts, valued at an astounding $455 billion, has solidified its position as a key player in the AI market and boosted investor confidence in the ongoing tech rally. Oracle Cloud Infrastructure (OCI) is now the preferred platform for leading AI companies such as Nvidia and OpenAI. According to CEO Safra Catz, Oracle currently holds cloud service contracts totaling $455 billion, a figure expected to exceed $455 billion in the coming months. This number is expected to soon surpass the half-trillion-dollar mark in the next few months.

Oracle's remaining performance obligations, which represent future revenue from customer contracts, surged by approximately 360% in the last quarter. This backlog has led the company to project that its OCI business will grow to $18 billion in the current fiscal year and skyrocket to $144 billion by 2030. Following this news, Oracle's stock experienced a massive one-day gain of more than 36%, adding over $250 billion to its market value and making chairman Larry Ellison the world's richest person. He currently holds more than 40% of Oracle shares, and the company's success is his success.