Fast Money Blog- 5/14/24

The week on Wall Street was a busy one, with the stock market reacting to Oracle’s earnings release, the monthly economic reports and the Fed’s policy meeting. 

The good news is the stock market moved forward with all of the positive news that came out.

Here’s why:

On Tuesday, June 11th, Oracle Corporation (ORCL) delivered big with its Q4 2024 earnings.

To understand the company’s potential it’s important to know what Oracle does. Oracle specializes in developing and marketing database software and technology, cloud-engineered systems, and enterprise software products—particularly database management systems.  

Here’s what you need to know about their Q4 earnings:

Total quarterly revenue came in at $14.3 billion, up 3% year-over-year. 

Cloud revenue for the quarter came in at a total of $5.3 billion, up 20% year-over-year. 

Cloud Infrastructure revenue for Q4 was $2 billion, up 42% year-over-year. 

For fiscal year 2024 Total Revenue was $53 billion, up 6% year-over-year. 

However, the Q4 sales and earnings results were not the reason the stock surged in Wednesday’s trading. 

What really impressed Wall Street was Oracle’s expected sales growth guidance for fiscal 2025. 

The company is focused on expanding its cloud infrastructure unit — which rents computing power and storage, and is seeing great success with generative AI startups. 

Oracle announced cloud infrastructure partnerships with Open AI and Microsoft, as well as bringing its database to Google Cloud, available in November.  

Oracle also reported $98 billion of remaining performance obligations, or RPO, in the fourth quarter, which is a figure that represents the revenue that the company expects to receive from contracts in future quarters. 

Oracle is emerging as a great long-term hold because of their positioning in the AI marketplace.

On Wednesday, June 12th, the Consumer Price Index data for May showed that prices remained flat. This was due in part by a 2% year-over-year drop in the energy segment, with the price of gas dropping 3.6% year-over-year. 

The Federal Reserve announced it was leaving interest rates steady for the seventh time in a row and foresee fewer rate cuts than previously announced. 

From today onward, I see the stock market moving forward with tech and AI stocks rising significantly. 

Stay patient and stay positive!