Oracle (ORCL) is the monster stock to watch today after posting third-quarter results. In addition to hinting at a partnership with Nvidia (NVDA), shares will open around 13.5% higher.
Oracle posted $1.41 a share in earnings per share, lifted by cloud revenue of $9.96% (up by 9.96% Y/Y). The firm benefited from a rise in new cloud infrastructure contracts in the quarter. Remaining Performance Obligations (“RPO”) are at over $80 billion, up by 29% Y/Y.
Nvidia stock fell by another 2% on Monday. This hurts Advanced Micro Devices (AMD) stock, which fell by 4.34%. Markets mistakenly believe that AMD stock trades at a discount to Nvidia.
Super Computer Micro (SMCI) is especially vulnerable to profit-taking. Its server sales are rising thanks to AI-related upgrades. However, graphics chips are the primary engine for AI.
The lawsuit against Nvidia over the use of AI training data is a headwind. As AI sifts through data, the industry must also contend with a rise in copyright claims. Some firms are settling with AI firms by monetizing user content. For example, Reddit (RDDT), which is about to seek a public listing, signed a deal to sell user content, albeit for only $60 million a year. Last month Reddit entered an exclusive AI licensing deal with Google. This will make Reddit’s content available for training Google’s AI models.
Users may choose to stop using sites that sell data, threatening the growth of Reddit.
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