Nvidia may have a rival on the AI dance floor: Oracle

Nvidia (NVDA) may be the belle of the AI ball, but Oracle (ORCL) is making a strong case it belongs on the same dance floor.

“It’s tempting to switch that narrative,” Interactive Brokers chief strategist Steve Sosnick said on Yahoo Finance’s Opening Bid. “But I’m still going to stick with whoever brought me to the dance, and that’s Nvidia.”

“Bottom line is they are the ones still pumping out the chips that everybody needs and everybody wants,” he explained, adding that some of Nvidia’s “biggest customers are still the biggest drivers.” Those include Amazon (AMZN), Microsoft (MSFT), Google (GOOGL), and Meta (META).

Still, the talk around the Street has been: Is Oracle emerging as a serious AI contender?

The company has posted some serious moves. Its stock surged 36% on Wednesday after reporting whopping cloud demand numbers.

Shares were trading slightly lower on Thursday, but year to date, the stock is up 91%.

For its latest quarter, Oracle reported an eye-popping $332 billion in bookings, the largest number Morgan Stanley’s team says it has ever seen. Analyst Keith Weiss called it a “tectonic shift in the business model towards Data Center Operator.”

Still, Oracle’s quarterly performance missed on the top and bottom lines. The company reported $14.93 billion in Q1 revenue, missing consensus estimates of $15.04 billion, according to Bloomberg data. Earnings per share were $1.47, just below the $1.48 estimate.

“While the reported metrics in the quarter itself were not impressive … none of that matters,” Weiss wrote, adding that Oracle is taking “a commanding lead in that market with these contract additions.”

Oracle CEO Safra Catz said in a statement that the company had signed “four multibillion-dollar contracts with three different customers,” which resulted in $455 billion in remaining performance obligations, up 359% year over year. Catz added the company expects to sign additional multibillion-dollar deals with other clients.

Management now expects Oracle’s Cloud Infrastructure revenue to ramp from $18 billion in FY26 to $114 billion in FY29.

Bank of America’s Brad Sills, who upgraded Oracle to Buy and raised his price target to $368, pointed to those figures as proof that Oracle is becoming a “key AI compute platform.”

“Oracle is clearly leveraging a number of advantages in its cloud software/hardware businesses to attract the largest of the AI enterprises, including OpenAI, xAI, Meta, NVIDIA and AMD,” Sills noted.