Oracle Corp (NYSE:ORCL, ETR:ORC) will report its fiscal third quarter report on Monday, March 10 with all eyes on an update on the company’s role in the Stargate project.
Stargate, a joint venture between Oracle, SoftBank, OpeanAI and MGX, aims to invest $500 billion over four years in AI infrastructure across the US.
Analysts at UBS expect Oracle’s earnings to be dominated by its initial public comments on Stargate, which they see as a positive catalyst.
“We expect Oracle to provide some color around the potential financial impact of Stargate (revenue, Recovery Point Objective, capex) on the call, which we believe has the potential to outweigh everything else on this call,” they wrote.
Their checks have indicated the first OpenAI Abilene GPU cluster, implying a material potential lift to Oracle Cloud Infrastructure (OCI) in the August quarter and the potential for a large OpenAI commitment impacting the backlog as early as the February quarter.
“For the most part our checks all cited at least stable Oracle spend growth with none highlighting any pressure points that would strike us as red flags,” they wrote.
“While the macro backdrop and read-through from software peers (from Microsoft on down) remains mixed, feedback leaned positive.”
UBS repeated its ‘Buy’ rating on Oracle with a $210 price target.
Shares of Oracle traded down 1.2% at about $149 late morning on Friday.