Oracle Stock Outlook: Is ORCL a Buy After Q4 Results?

Oracle (NYSE:ORCL) is among the leading artificial intelligence and cloud computing companies that have been experiencing incredible growth lately. This is not the case now Nvidia (NASDAQ:NVDA) like a momentum. However, up over 30% year-to-date, with much of that gain occurring in recent weeks, it is clear that investors are now buying this stock heavily.

The company’s cloud revenue grew 25% in 2024, driven by the company’s core cloud services business, highlighting its strengths in autonomous databases and AI computing.

This strategic shift has reignited revenue growth, which has accelerated to 8.5% over the past three years.

It’s tempting for investors, but the question on many minds in the company’s latest earnings report was: Can this continue?

Let’s take a look at what Oracle reported and why the company’s shares are rising after the publication.

ORCL shares surge after Q4 results

Oracle reported no earnings or revenue in its fiscal fourth quarter, according to data released earlier this week. Initially, based on the headlines alone, you would think that the company’s shares would fall.

On the contrary. In fact, the stock saw double-digit gains as Oracle announced key partnerships with OpenAI and Microsoft (NASDAQ:MSFT) to develop its artificial intelligence capabilities, an Alphabet (NASDAQ:GOOG) on the cloud front.

The company also saw a strong future outlook given its view that its cloud infrastructure business has not yet reached full capacity.

In fact, the company expects sales to grow much faster in 2025, which has apparently surprised the market.

Perhaps most importantly, in its earnings statement, the company said that growth is expected to accelerate each quarter as Oracle seeks to meet extremely high demand in the compute server and storage markets.

Can this growth continue?

It’s a rather bullish approach in the market, but companies are praising it all over the world. Entities operating in the cloud data storage and computing market are seeing incredible demand and there is simply no end in sight.

I’m sure things will slow down at some point. Trees don’t grow to the sky. However, given our society’s collective demand for more and more data, this is an unfavorable trend that may last for a really long time.

Oracle sees strong demand on the horizon at least through 2025. That’s a recipe for massive growth, although it remains to be seen how much of those expectations will be realized at current levels.

Bottom line

I believe Oracle is well positioned to continue to have share in the cloud computing and data storage market. This is a sector that may have lost some of its luster compared to AI trading, but these trends are all interconnected.

For those looking to gain exposure to a relatively solid long-term growth path, ORCL stock is worth considering now.

As of the date of publication, Chris MacDonald did not hold (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s Editorial Guidelines.