2024-03-13 05:03:00
Oracle shares rose more than 13 percent to reach a record high, amid signs that the company is making progress in its plan to seize a share of the cloud computing market thanks to its alliance with Nvidia.
The company has positioned itself as a low-cost cloud provider and has spent billions of dollars on Nvidia chips as it looks to compete with industry heavyweights Amazon and Microsoft.
These efforts, along with a partnership that gives its cloud customers access to Nvidia supercomputers, helped Oracle achieve a 25 percent jump in cloud computing revenue for the third quarter.
“Oracle’s momentum is back on track following seeing disappointing cloud results in the previous two quarters,” analysts at Piper Sandler said in a note.
The company was on track to add more than $40 billion to its market capitalization, based on its stock price of $129.37.
Its shares have underperformed big cloud rivals like Microsoft in 2023 and so far this year, due to concerns that data center capacity constraints and an uncertain economic outlook are weighing on the company’s growth.
CEO Safra Catz allayed some of those concerns, saying the company “signed several big deals this quarter, and we have many more in the pipeline.”
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