Oracle Stock Drops 11% Even AI Deals Couldn’t Save the Company | United States

Oracle Stock Plunges Despite New AI Deals With Nvidia and Meta  Here’s the Real Reason Behind the Crash

Tds Virals news, United States: Oracle (ORCL) shares saw a sharp decline late Wednesday despite new agreements with major AI infrastructure companies.

Investors were expected to impress this quarter after announcing major contracts with giants like Nvidia and Meta.

However, the company’s Q2 earnings disappointed the market, and as a result, shares fell 11% in after-hours trading.

Oracle Stock AI bet is big, but revenue miss spoils everything-Oracle reported that its backlog has grown to a record $523 billion due to new AI cloud deals with Nvidia and Meta.

This shows the company is playing a major role in AI cloud infrastructure.

But here’s the real problem:

Q2 Revenue: $16.06 Billion (Below Analysts’ Expectations)

Although revenue increased 14% year-over-year, it fell short of Wall Street expectations.

This revenue miss dampened investors’ mood.

Earnings Strong, But Not Enough

Oracle reported adjusted EPS of $2.26, which was better than expected, but it didn’t cover up the revenue disappointment.

Why Did Oracle Stock Fall? What Are the Real Reasons?

1. Fears of an AI Bubble For the past two months, investors have been growing concerned that a speculative boom is underway in the AI ​​sector.

Oracle Stock growth appears to be heavily dependent on AI hyperscalers a dependence investors find unsustainable.

2. Dependence on a Few Large Customers While the mention of heavy AI spenders like Meta and Nvidia is positive,

it has also raised a new concern Is demand for Oracle’s cloud platform widespread or limited to just a few large customers?

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3. Fears of Circular Deals Nvidia supplies AI chips to Oracle. Oracle provides Nvidia with massive cloud capacity.

Such deals are often referred to in the market as “circular demand,” which raises questions about sustainable growth.

4. 35% Decline Since September Oracle’s stock was at an all-time high in September—up 100% since the start of the year.

Now: Drop from September high: 35%

YTD (Year-to-Date) gains are now just 33%

This shows that sentiment has deteriorated sharply.

Analysts’ Warnings Proven Right

Before the earnings report, Wall Street analysts had predicted a tough setup.

The market wanted to see how widespread AI demands were and how many enterprise customers were adopting Oracle’s cloud services.

But the mention of Meta had the opposite effect investors felt that:

Oracle’s AI growth is still narrow, not broad.

Next Quarter Guidance: Mixed Signals

Oracle provided some positive updates for Q3:

Revenue Growth Forecast: 19%–21%

Above analyst projections.

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EPS Guidance: $1.70–$1.74

Close to analyst estimates.

The guidance is good, but the market is overreacting to the revenue miss, especially due to increased competition in the AI ​​sector and cloud market saturation.

Why does this matter to investors?

• 1. Sustainability Test of Heavy Spending on AI Infrastructure The AI ​​segment is growing rapidly, but how real and sustainable the demand is remains an open question.
• 2. Growth vs. Dependence Dilemma Oracle’s growth is impressive, but excessive dependence on a few clients creates long-term risk.
• 3. Cloud Market War Intensifies Amazon AWS, Google Cloud, and Microsoft Azure are already aggressively expanding.

If Oracle fails to attract broader enterprise clients, market share pressure could increase.

Oracle Stock Outlook: Buy the Dip or Further Decline? Market analysts are divided.

Bullish View: AI cloud demand is very strong in the long term. Backlog shows $523B future earnings potential. Major companies like Nvidia and Meta are relying on Oracle.

Bearish View: Revenue miss means demand isn’t yet broad. Competition is more intense than ever. Volatility in the AI ​​sector is at its peak. Investment decisions will depend on investors’ risk appetite.

Oracle Stock-FAQs (SEO Optimized)

1. Why are Oracle shares falling?

Due to missed revenue expectations and growing concerns about the sustainability of AI demand.

2. Are Oracle’s AI deals positive?

Yes, but investors want to see broader adoption, not just reliance on large clients.

3. Can Oracle show recovery in the next quarters?

Guidance is strong, but market volatility and competition are the main challenges.