steven fiorillo
Raw Thoughts on Oracle's Sell-Off
10/7/2025, 10:58:15 PM
Economic Summary
- Oracle reported ~$900M in revenue from renting Nvidia-powered servers but only ~$125M gross profit; the host calls this short-term noise and notes Oracle raised ~$18B in bonds to finance growth, implying the margin story may be overstated (ORCL).
- Most large hyperscalers are funding rising capex from free cash flow rather than debt, suggesting their balance sheets and long-term investment plans remain strong and contagion from Oracle's report is unlikely (relevant to AMZN, GOOGL, META).
- Deals like OpenAI's with AMD, plus major Nvidia partnerships, point to a competitive compute arms race that should support strong demand and revenue growth for chip suppliers and cloud compute providers (NVDA, AMD).
Bullish
- Hyperscalers fund capex from enormous free cash flow, reducing contagion risk from Oracle's report.
- Nvidia expected to deliver stellar revenue and EPS; analysts project continued high YoY growth (NVDA).
- OpenAI's deal with AMD underscores a compute arms race, expanding demand for multiple suppliers (AMD).
- Oracle's $18B bond raise is a deliberate, long-term growth financing move rather than a sign of distress (ORCL).
Bearish
- Oracle reported $900M in server rental revenue with only $125M gross profit, labeled razor-thin margins.
- Smaller cloud plays like CoreWeave and Nebus Group held share-price declines after the report.
- Narratives about thin cloud-compute margins could spook short-term market sentiment.
Bullish tickers
NVDAAMDORCLAMZNGOOGLMETA
Bearish tickers
ORCLCOREWEAVENEBUS GROUP
ORCL
3 price targets
290271284
Bullish
Raised about $18B in debt to finance growth; host views the sell-off as short-term pain for long-term gain.
Bearish
Reported $900M in rental revenue with only $125M gross profit, prompting criticism of razor-thin margins.
NVDA
Bullish
Analysts expect strong revenue and EPS; central to the compute arms race and likely to report stellar results.
Bearish
No sustained pullback noted in the transcript; bears tried to make Oracle news a red herring for Nvidia.
AMD
Bullish
Deal with OpenAI highlights AMD as a growing participant in the compute race alongside Nvidia.
OPENAI
Bullish
Partnerships (e.g., with AMD) are accelerating demand for cloud and chip providers.
COREWEAVE
Bearish
Shares stayed down (~3.75%) after the Oracle-related report and market reaction.
NEBUS GROUP
Bearish
Reported to be down almost 6%, selling off by about $7.24.
AMZN
Bullish
Host predicts Andy Jassy (Amazon) will beat expectations in upcoming earnings.
GOOGL
Bullish
Host predicts Sundar Pichai (Alphabet/Google) will beat expectations in upcoming earnings.
META
Bullish
Host expects Mark Zuckerberg to make bold moves to regain momentum after the Meta Glasses reveal.
People mentioned
Andy JassySundar PichaiMark Zuckerberg