Oracle shares surged about 35% on Wednesday after the company highlighted a surge in demand for its cloud services from AI firms, signalling a deeper push into the infrastructure supporting artificial intelligence systems. The growth in Oracle’s cloud business reflects a broader industry trend, with companies such as OpenAI and xAI ramping up spending on massive computing capacity needed to stay competitive in the AI race, boosting annual investments to hundreds of billions of dollars.The stock was up 34.7%, reaching a record high of $325.90 in early trading, marking its largest single-day jump since 1992. If these gains hold, Oracle will add approximately $237 billion to its market valuation, bringing the total to around $915 billion and moving closer to the coveted $1 trillion club. Shares have risen 45% so far this year, outperforming the so-called Magnificent Seven and the broader S&P 500 index, with investors betting heavily on AI-driven cloud firms, Reuters reported.Oracle’s results also lifted shares of Nvidia (NVDA.O), Broadcom, and Advanced Micro Devices, which supply semiconductors for data centers, with gains ranging between 2.8% and 4.6% in early trading. Competitor CoreWeave (CRWV.O) shares were up 17%. Oracle reported four multi-billion-dollar contracts with three clients during the August quarter, reflecting strong demand for its cloud services. CEO Safra Catz said, “Over the next few months, we expect to sign up several additional multi-billion-dollar customers and RPO is likely to exceed half-a-trillion dollars.”Despite Oracle’s gains, Microsoft, Amazon Web Services, and Google Cloud continue to dominate the cloud market with a combined 65% share, while Oracle, Alibaba, CoreWeave, and others hold smaller slices. Oracle has also partnered with Amazon, Alphabet, and Microsoft to allow their cloud customers to run Oracle Cloud Infrastructure (OCI) alongside native services, with revenues from these partnerships increasing more than sixteen-fold in the first quarter.Ben Reitzes, analyst at Melius Research, said, “What matters here is that this figure now includes contributions from the Stargate venture and two other big AI players, meaning revenues beyond 2026 go much higher.” Analysts noted Oracle’s involvement in SoftBank and OpenAI’s Stargate project as a major tailwind, giving the company a strategic foothold in large-scale AI infrastructure expected to channel about $500 billion in spending, Reuters reported.Oracle also provides cloud services to xAI, the AI startup founded by Elon Musk, who is a longtime ally of Oracle chairman Larry Ellison. Ellison, 81, whose net worth is largely derived from his 41% stake in Oracle, is fast approaching Musk in the race for the world’s richest title, according to Forbes data. Oracle’s stock currently trades at over 33.34 times its 12-month forward earnings estimates, compared with Amazon’s 32.34 and Microsoft’s 30.83.
