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A one-day plunge of 13.5%! Oracle shares suffer biggest drop since 2002
- PHPzforward
- 2023-09-17 16:41:121269browse
Oracle’s stock price plunged 13.5% on September 12, local time, the largest decline in more than 20 years. The reason was that the company released disappointing quarterly earnings and issued a lower-than-expected outlook for future performance.
According to data, the last time Oracle’s stock price experienced its largest decline was in March 2002, at the end of the bursting of the Internet bubble, with a drop of as much as 15%.
Oracle’s revenue in the fiscal first quarter was $12.45 billion, slightly below analysts’ estimates of $12.47 billion, according to data from the London Stock Exchange (LSEG) Dollar. The company expects revenue to rise 5% to 7% in the fiscal second quarter, below analysts' average estimate of 8%. The plunge caused Oracle Chairman Larry Ellison to lose about $180. billion dollar wealth. According to Forbes, Ellison is the fourth richest person in the world with a net worth of $140.6 billion, behind Amazon founder Jeff Bezos but ahead of Warren Buffett.
# Like major companies in the tech industry, Oracle has been selling investors on the benefits of artificial intelligence to its business. During the quarter, the company added
capabilities to its Fusion Cloud and human capital management software. Ellison said in the financial report, "As of today, the amount of contracts signed by artificial intelligence development companies to purchase Oracle Gen2 Cloud exceeds $4 billion, which is double the amount booked at the end of the previous quarter."
However, analysts at Stifel believe that "it is clear that investors are pricing in more upside related to artificial intelligence and cloud computing." The agency has a hold rating on the stock and a price target of 100% per share. $120.
Despite the sharp decline, Oracle is still up 34% year to date, beating the S&P 500's projected 16% gain
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