"Its 14% growth in revenue came up just short of expectations. Doubts also remain about whether all the spending that Oracle is doing on AI technology will produce the payoff of increased profits and productivity that proponents are promising. Analysts said they were surprised by how much Oracle may spend on AI investments this fiscal year, and questions continue about how the company will pay for it."
"Oracle Chairman Larry Ellison said it will continue to buy chips from Nvidia, but it's now taking a policy of "chip neutrality," where it will use "whatever chips our customers want to buy. There are going to be a lot of changes in AI technology over the next few years and we must remain agile in response to those changes.""
"Most U.S. stocks are rising on Thursday, but a drop for Oracle is holding Wall Street back as investors question whether its big spending on artificial-intelligence technology will pay off. The S&P 500 fell 0.4% in early trading and pulled a bit further from its all-time high, which was set in October. The Dow Jones Industrial Average was up 233 points, or 0.5%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 0.7% lower."
Most U.S. stocks rose while the S&P 500 fell 0.4% in early trading and moved away from its October all-time high. Oracle plunged 14.5% despite reporting stronger-than-expected profit because revenue growth of 14% missed forecasts and investors questioned the company's large AI expenditures and funding strategy. Analysts expressed surprise at the scale of Oracle's planned AI investments and uncertainty about whether those outlays will translate into higher productivity and profits, weighing on AI-sector sentiment. Nvidia fell 2.8% and remained the largest S&P 500 weight. Easing Treasury yields, with the 10-year at 4.10%, supported other stocks.
Read at Fortune
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