Oracle stock is tacking on gains after an already strong week, as investors digest commentary from a late Thursday analyst briefing. The company gave an upbeat short- and long-term revenue forecast, highlighting its AI strengths.
Oracle told analysts Thursday that it expects revenue to reach $104 billion in fiscal 2029, according to a FactSet transcript. The outlook implies roughly 16% compound annual sales growth over the next five years. Last year, Oracle's revenue grew 6%
The company also raised its sales outlook for fiscal 2026, from $65 billion to at least $66 billion. Fiscal 2026 starts next June.
On the stock market today, Oracle stock gained more than 1% to 163.50 in late morning trades.
Oracle Leverages Databases For AI Growth
The upbeat outlook presented at Oracle's annual meeting with financial analysts underscored what appeared to be the company's strengthening position in the enterprise technology market. The company hopes to help customers of its massive legacy database business use their data to power AI applications.
"In the AI era, we believe companies that own the data will emerge as the winners," Mizuho analyst Siti Panigrahi wrote in a client note Friday. "Leveraging its strong and sticky position in databases and combining its AI investment and multicloud strategy, Oracle is well-positioned to unlock massive value for its customers and garner mega contracts to deliver midteens growth with high margins."
Oracle is working to grow its cloud infrastructure business, called OCI. The business competes against Amazon's Amazon Web Services, Microsoft Azure and Google Cloud from Alphabet. While Oracle was later to offer cloud services and has much smaller market share than the so-called Big Three. But analysts are bullish on OCI's growth.
"We continue to believe that we are still in the early innings here as Oracle workloads (many mission critical) have mostly not migrated to the cloud yet," Barclay analyst Raimo Lenschow wrote to clients late Thursday. "Our conversations at the conference showed that the Oracle offering really seems differentiated as it is more modern (the advantage of starting later) and as Oracle paid particular focus on the networking layer, which is now a huge advantage in the new AI world that requires extremely low network latency."
OCI's modern cloud offering is helping it win contracts from AI-focused startups, according to Oracle. The company said in its earnings release Monday that it had won 42 new cloud contracts for AI computing-chips, worth $3 billion total, during its August quarter.
Oracle Adds To Break Out
The gains highlight a strong week for Oracle stock. Oracle rose 11% on Tuesday after the Austin, Texas-based company reported stronger-than-expected results for its August quarter.
In a statement, Oracle CEO Safra Catz said, "As cloud services became Oracle's largest business, both our operating income and earnings per share growth accelerated."
The company also stunned the technology world by announcing that it has formed a partnership with longtime rival Amazon. The new alliance quick won praise from analysts.
"Oracle and Amazon had been competitive for database customers, so new partnership suggests companies have a lot to gain by working together," BofA Securities analyst Justin Post said in a note to clients. "We think all cloud providers have a sizable opportunity to unlock demand for infrastructure/applications using data housed within Oracle's databases."
Oracle broke out above a flat base buy point of 146.59, according to MarketSurge pattern recognition. The stock has gained 15% this week as of midday Friday. Shares are now extended beyond a 5% buy zone.
Overall, Oracle stock is up 57% this year compared to an 18% gain for the S&P 500.
