Oracle’s stock is soaring as AI partnerships and cloud growth redefine its future. Discover how Oracle went from boring to a tech powerhouse.
Table of Contents
How Oracle Became Cool Again in the AI Era
For decades, Oracle was considered a legacy software giant—reliable but hardly exciting. That narrative has flipped. With the artificial intelligence boom fueling explosive demand for cloud computing, Oracle (ORCL) has positioned itself as a critical player in the AI ecosystem.
The company’s partnership with OpenAI, billion-dollar data center contracts, and a potential role in the future of TikTok have pushed Oracle’s stock up more than 80% this year—outpacing even tech titans like Microsoft, Google, and Meta.
Let’s explore how Oracle went from being a “boring” database company to one of the most talked-about firms in Silicon Valley.
Oracle’s Big Break: From CIA Contract to AI Powerhouse
- Oracle was founded in the late 1970s after winning a CIA contract for a project code-named Oracle.
- Nearly 50 years later, its second big break has come from the AI revolution.
- Oracle has inked a massive $300 billion deal with OpenAI for data center space, showing just how central it has become in powering AI workloads.
This sudden rise mirrors Nvidia’s transformation from a gaming chip company to the global leader in AI hardware.
Cloud Growth Driving Oracle’s Stock Surge
Oracle was late to the cloud computing race, trailing behind Amazon Web Services (AWS), Google Cloud, and Microsoft Azure. Even founder Larry Ellison once dismissed cloud technology as “gibberish.”
Yet the company’s fortunes shifted in 2022, when the public launch of ChatGPT highlighted the massive need for AI infrastructure.
📈 Oracle’s key cloud milestones:
- Cloud revenue projected to hit $144 billion by 2030.
- Future revenue obligations soared 359% year-on-year to $455 billion.
- Signed four multi-billion-dollar contracts in just one quarter.
This surge has turned Oracle into one of Wall Street’s favorite AI plays.
Oracle’s AI Advantage
Unlike Google and Microsoft, Oracle isn’t building its own large language model. That frees up more data center space to lease to third-party AI firms.
Key partnerships include:
- OpenAI – A long-term, $300B agreement for cloud infrastructure.
- Nvidia – Collaboration on AI chip access to fuel data center growth.
- Stargate Initiative – A $500B project to expand AI infrastructure in the US.
This strategic positioning means Oracle can act as an AI landlord, profiting from demand without competing directly in the model-building space.
Oracle’s TikTok Connection
Another boost could come from a TikTok deal.
- Oracle already hosts TikTok’s US data under Project Texas.
- With US-China negotiations ongoing, Oracle is a contender to gain further control of TikTok’s American operations.
- If successful, this could open doors to 170 million US users and vast advertising revenue.
Such a move would cement Oracle as not just an enterprise giant but also a player in the consumer-tech space.
Risks and Challenges Ahead
Despite its momentum, Oracle faces potential risks:
- AI growth may slow, reducing demand for its cloud services.
- As a smaller player compared to AWS and Azure, Oracle is more vulnerable to market shifts.
- Capital-intensive projects (over $27 billion spent in one quarter) could weigh on profitability if growth stalls.
Still, most analysts argue Oracle is in a “sweet spot” of AI demand.
FAQs About Oracle’s AI Growth
Q1: Why has Oracle’s stock surged in 2025?
Oracle’s stock has climbed over 80% this year due to AI-driven demand for cloud infrastructure, billion-dollar contracts, and partnerships with OpenAI and Nvidia.
Q2: Is Oracle bigger than AWS, Microsoft Azure, or Google Cloud?
No, Oracle is still smaller than these “hyperscalers.” However, its AI-focused deals have given it a unique growth advantage.
Q3: How is Oracle connected to TikTok?
Oracle hosts TikTok’s US user data as part of Project Texas and could gain partial or full control of TikTok’s US operations if a deal is finalized.
Q4: What is Oracle’s revenue outlook for its cloud business?
Oracle projects cloud revenue will hit $144 billion by 2030, driven by multi-billion-dollar AI contracts.
Q5: What risks does Oracle face in the AI boom?
Key risks include slowing AI adoption, high capital expenditures, and competition from larger cloud providers like AWS and Microsoft Azure.
Conclusion: From Boring to Booming
Oracle has rewritten its story. Once seen as a slow-moving enterprise software company, it is now a central player in AI infrastructure, drawing comparisons to Nvidia’s transformation.
With explosive growth in cloud revenue, strategic AI partnerships, and a possible role in TikTok’s future, Oracle has become one of the coolest stocks to watch in 2025.