(Video Transcript)

Watching Oracle like a hawk

Oracle shares have been falling quite rapidly. Let us show you the all-sessions reading on our IG chart here. As you can see there, we had a huge drop there in the previous session, and then the all-sessions, right as we speak, are down 1.2%.

This is after the cloud services provider said it was forecasting current quarter revenues below target, and the company also narrowly missed first-quarter expectations. What is interesting is that this company actually had a really good run during Covid, during lockdown.

‘Working-from-home’ has hurt Oracle

And what’s happened now is that as businesses are rethinking their workspaces and their sort of hybrid or work-from-home-type policies and digitisation plans. This is hurting Oracle as it plays catch-up in a segment that is dominated by bigger rivals like Amazon, web services, while Microsoft is another very big player.

Don’t forget there are many other contenders coming into this market. However, analysts still say that the adoption of artificial intelligence (AI) is going to boost Oracle’s cloud-infrastructure business. And this is what perhaps there wasn’t enough of. We didn’t get enough comments about how this cloud-infrastructure business and the revenue streams were going to work out for Oracle.

Competitive threat from other contenders

But what’s also interesting, looking at a longer-term chart, because from if we take a look at this point here, and we give you a year-to-date chart, Oracle shares have gained some 50.5%. That’s more than 50%. But if we move that slightly lower to see the effects of this here, then we can see that it’s quite a mark fall there, because it brings that year-to-date figure down to up 40%.

As I mentioned earlier, we’re keeping a close eye on the shares for you of Oracle as it is an all-session stock on IG.