New York, Jan 24, 2026, 10:31 ET — Market closed.
- On Friday, Oracle shares slipped 0.6% as investors mulled over the expenses and funding needed for its AI expansion.
- Morgan Stanley lowered its price target, cautioning that the company now has “little room for error.”
- A proposed U.S. joint venture involving TikTok would bring Oracle nearer to the app’s core technology—and subject it to new scrutiny.
Oracle shares closed Friday down 0.6%, settling at $177.16 after trading between $172.15 and $180.18. Morgan Stanley lowered its price target, highlighting the expenses tied to Oracle’s drive to deliver AI computing power.
Why this matters now: Investors have been betting on Oracle scoring major AI cloud deals, but attention is shifting to the costs behind scaling up. The discussion has moved beyond demand to focus on cash flow—how fast data centers start generating profit and if the balance sheet can cover the upfront expenses.
Tensions escalated when TikTok announced it had sealed a deal for a “majority American-owned” joint venture to run its U.S. operations. Oracle, Silver Lake, and Abu Dhabi’s MGX will each hold a 15% stake. The company also confirmed its recommendation algorithm would be stored on Oracle’s U.S.-based cloud infrastructure. Reuters
Morgan Stanley’s Keith Weiss maintained an “equal-weight” rating but cut his price target to $213 from $320. He described Oracle’s GPU-as-a-service segment—leasing the chips that run AI models—as a “sizable revenue opportunity” but noted it’s “significantly capital intensive.” Weiss warned the stock leaves “little room for error.” Investing.com
Oracle has recently emphasized growth but hasn’t shied away from the impact of the spending bill. In December, it raised its fiscal 2026 capital expenditure forecast by $15 billion, now expecting $50 billion, up from the earlier $35 billion estimate. The company also reported $523 billion in remaining performance obligations, basically contracted revenue yet to be recognized. CEO Clay Magouyrk mentioned Oracle is exploring models allowing “customers can actually bring their own chips,” which would ease Oracle’s upfront capital requirements. Reuters
Competition shows no signs of letting up. Oracle is pushing hard to catch up with cloud giants like Amazon, Microsoft, and Alphabet, who continue to pour billions into data centers and AI infrastructure. They’re all battling fiercely for the same enterprise workloads.
Washington may throw a wrench into the TikTok deal. Senator Ed Markey urged Congress to probe the arrangement, pointing to a “severe lack of transparency.” John Moolenaar, chair of the House China panel, also pushed for closer examination. Reuters
But a lot could still change. The TikTok setup raises ongoing concerns about governance and whether U.S. approvals will hold up. On top of that, the AI expansion risks slower payback if customer growth or pricing lags behind the spending spree.
Next week brings a busy U.S. earnings calendar that could move cloud stocks, featuring megacaps like Microsoft, Meta, and Apple reporting results. Their earnings could reshape forecasts for enterprise tech spending and data-center demand.
Oracle’s next major event is its upcoming earnings report. While the company hasn’t officially announced a date, market calendars point to Monday, March 9, after the close—this estimate comes from previous reporting patterns.
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