Oracle's (ORCL) Cloud Business Set to Grow 14x by 2030, UBS Says

Oracle Corporation (NYSE:ORCL) is one of the AI Stocks In The Spotlight For Investors. On September 10, UBS analyst Karl Keirstead raised the price target on the stock to $360.00 (from $280.00) while maintaining a Buy rating.

The rating affirmation follows Oracle’s disclosure of $317 billion in incremental backlog, supporting the growth forecast for its cloud infrastructure segment to expand from $10 billion in fiscal year 2025 to $144 billion in fiscal year 2030.

While the company hasn’t disclosed its customers, the firm believes that the largest boost comes from OpenAI. On the same day, The Wall Street Journal reported that indeed, OpenAI has signed a contract to purchase $300 billion in computing power over the course of five years from Oracle.

“The key take from the quarter is really the $317b of incremental backlog, that drives the growth guide for Oracle’s cloud infra segment – 14x over the next 5 years from $10b in FY25 to $144b in FY30. Oracle didn’t disclose customers but we’re assuming that the largest boost is from OpenAI ($100b+), alongside xAI and Meta. This diversity (not just OpenAI, training AND inference) lowers the stock’s risk profile, although concentration with OpenAI will still be high."

"The guide for FY26 operating income growth of mid-teens (we modeled 8%) was another positive and speaks to tight opex/headcount control. While our FY28+ revs estimates are moving up sharply, we’re assuming some portion of the cloud infra growth comes via database migrations and hence on-prem database support revs could go ex-growth. Net, for FY29, we’re raising our revs estimate from $134b to $163b, our OM estimate from 38% to 37% and our non-GAAP EPS estimate from $12.51 to $13.98.”

Oracle Corporation (NYSE:ORCL) is a database management and cloud service provider.

While we acknowledge the potential of ORCL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT:10 Buzzing AI Stocks on Wall Street and 10 AI Stocks on Wall Street’s Radar.

Disclosure: None.