Oracle Chair, Larry Ellison, experienced a massive loss in wealth this week as Oracle shares plummeted by 12%, marking the company’s largest drop in over twenty years. This decrease in stock value resulted in Ellison losing approximately $18 billion, making him now the fourth-richest person in the world.
This disappointing turn of events came after Oracle reported its fiscal first-quarter revenue of $12.45 billion, falling short of the average analyst estimate. In addition, the company’s projected revenue for the current quarter is expected to increase by only 5% to 7%, which is below the average analyst estimate of 8%.
Despite these less-than-stellar results, Oracle has been actively promoting the advantages of artificial intelligence (AI) to its business strategy. The company has recently added AI features to its Fusion Cloud and Human Capital Management Software. However, analysts believe that investors may have anticipated more significant growth in the AI and cloud-related sectors from Oracle.
Oracle CEO, Safra Catz, acknowledged challenges faced by the company’s Cerner unit, which is currently undergoing a transition to the cloud. While the revenue in Oracle’s cloud services and license support segment increased by 13%, sales in the cloud license and on-premises license segment fell by 10%.
Despite the drastic drop in stock value, Oracle shares have still performed well this year, with a 34% increase, outperforming the S&P 500. This positive growth indicates that despite the current setback, Oracle remains a strong player in the market.
As Oracle continues to navigate the challenges brought by the recent drop in stock value, the company will need to find new avenues for growth and address investor concerns over the future of AI and cloud-based technologies.
“Social media scholar. Reader. Zombieaholic. Hardcore music maven. Web fanatic. Coffee practitioner. Explorer.”