Will Cloud Investment Hurt Margins?

Still, even if Oracle is surviving economic turbulence, KeyBanc noted that the capital expenditure demands for Oracle to continue ramping up its cloud abilities will squeeze its margins.

KeyBanc expects $2 billion to $2.5 billion a quarter in capital expenditures for Oracle through the first half of fiscal year 2024.

The amount of spending expected from Oracle factored into a Friday report from Societe Generale moving Oracle’s stock from buy to hold, according to Seeking Alpha.

The analyst said that Oracle efforts to scale the cloud business could cut into top-line growth.