One quarter of Poland's GDP – that's how Oracle's valuation grew yesterday
Poland's GDP just surpassed $1 trillion, a significant symbolic milestone for our economy. However, on a global scale, such numbers have less dramatic resonance when compared to events on Wall Street. Yesterday, Oracle's shares rose by as much as 41% during the session and closed the day up 36%. This increased the company's market capitalization by $236 billion, reaching $922 billion. This means that in a single day, Oracle increased its market value by almost the equivalent of a quarter of the Polish economy. This demonstrates the enormous power of artificial intelligence in today's financial markets and its ability to instantly change the valuations of the world's largest companies.
Elon Musk is no longer number 1
Moreover, the dynamic growth of the price made the co-founder of the company Larry Ellison overtook Elon Musk to become the world's richest person. His wealth increased by $101 billion in a single day to $393 billion, the largest such increase in history.
Larry Ellison founded Oracle in 1977 and from the outset focused on developing database systems. Initially called Software Development Laboratories, the company later changed its name to Oracle, inspired by a research project commissioned by the CIA. Over time, Oracle became a leader in database software, providing solutions for the world's largest corporations and institutions. In the following decades, the company expanded its operations to include business applications, ERP systems, and cloud services, and today, a key element of its strategy is the development of computing infrastructure for artificial intelligenceThis has transformed Oracle from a database company into a major player in the global AI race.
Why has Oracle's valuation increased so much?
This strong move in the stock is a result of the release of its quarterly results. While revenue of $14,9 billion and earnings per share of $1,47 were marginally below analysts' expectations, the market focused on another element of the report. Oracle revealed a massive order backlog worth $455 billion, representing a 359% year-over-year increase. The company signed four new multi-billion dollar contracts and became a cloud infrastructure provider for key players in the artificial intelligence world, such as OpenAI, xAI, and Meta.
It was the potential of AI that fueled yesterday's growth. Oracle expects cloud services revenues to grow from the current $18 billion to $144 billion in 2030. Such ambitious forecasts coincide with a sharp increase in the company's capital expenditures. Capital expenditures are expected to reach $35 billion in 2026, compared to $21 billion a year earlier. The market currently values Oracle at a price-to-earnings (P/E) ratio close to 80, but with the expected dynamic order growth, the future valuation should be significantly lower.
Oracle is becoming the next big player in the cloud race alongside Microsoftu, Amazona i AThis year's nearly 100% share price increase shows that investors are viewing the company as one of the biggest beneficiaries of the AI boom. The change, which occurred in a single day, is a reminder that the market can be volatile, and as investors, we should remember that movements like yesterday's can occur both up and down.
About the author
Pawel Majtkowski - analyst eToro on the Polish market, which shares its weekly commentary on the latest stock market information. Paweł is a recognized expert on financial markets with extensive experience as an analyst in financial institutions. He is also one of the most cited experts in the field of economy and financial markets in Poland. He graduated from law studies at the University of Warsaw. He is also the author of many publications in the field of investing, personal finance and economy.