It would be difficult to overstate its impact. artificial intelligence (AI) has been on the technology landscape for the last few years. In fact, many of the world’s most valuable companies by market capitalization have joined this group. 1 trillion dollar clubRiding the artificial intelligence wave to new heights. But so far, only five companies can boast valuations of $2 trillion or more, and all of them have undeniable connections to artificial intelligence.
With a market cap of only $899 billion, it may seem premature to tell. Seer(NYSE:ORCL) is on its way to becoming a member of this select group. But the company’s growth has begun to accelerate, and management’s long-term outlook strongly suggests that AI will deliver strong growth throughout the remainder of the decade.
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It is well documented that Oracle counts approximately 98% of Global Fortune 500 companies as customers, many of which use a combination of cloud, database and enterprise software products, as well as related ancillary services. Those same users represent a target market for Oracle’s growing suite of cloud and AI solutions.
This captive audience and strong demand helped fuel an undeniable growth spurt. In Oracle’s fiscal 2026 first quarter (ended Aug. 31), its revenue rose 12% year over year to $14.9 billion, while its adjusted earnings per share (EPS) of $1.47 rose 6%, with both metrics accelerating from quarter to quarter.
Headline metrics fell short of Wall Street’s consensus estimates, which called for revenue of $15 billion and adjusted earnings per share of $1.48.
But beyond the headline numbers, Oracle had a surprise for investors. The company’s remaining performance obligation (RPO) – also commonly referred to as backlog – rose 359% to a record $455 billion. The company cited several billion-dollar contracts completed during the quarter. That’s not all. CEO Safra Catz turned heads when he said, “We expect to sign up several billion dollars’ worth of additional customers, and RPO will likely exceed half a trillion dollars.”
Oracle Cloud Infrastructure (OCI) — a cloud competitor Amazon Web Services, AlphabetGoogle Cloud and Microsoft Azure – grew 51% year over year and the company predicts impressive growth in the coming years:
Fiscal 2027 cloud revenue up 78% to $32 billion
Fiscal 2028 cloud revenue up 128% to $73 billion
Fiscal 2029 cloud revenue up 56% to $114 billion
Fiscal 2030 cloud revenue up 26% to $144 billion
These figures suggest that the “Big Three” cloud providers may rebrand as the “Big Four” in the very near future.
Oracle has an impeccable reputation for guiding customers to the cloud and AI solutions that best suit their needs. As a result, the company is well positioned to benefit from the rapid transition to productive AI. Given the magnitude of this emerging opportunity, the transition will likely take years, if not decades, to complete.
Oracle is expected to generate $67 billion in revenue in fiscal 2026 (which begins June 1), giving it a forward price-to-sales (P/S) ratio of about 13, according to Wall Street. Assuming P/S remains constant, Oracle would need to generate approximately $149 billion in annual revenue to support its $2 trillion market cap. Management’s cloud forecast alone puts the company in the ballpark within five years.
Analysts predict annual revenue growth of approximately 29% over the next five years. Oracle could reach a $2 trillion market value if the company achieves these goals before 2030.
Estimates of the size of the artificial intelligence market continue to increase. Big Four accounting firm Price Waterhouse Coopers (PwC) estimates that the opportunity could be worth $15.7 trillion annually by 2030, which helps underscore the magnitude of the opportunity.
Oracle looks well on its way to carving out a piece of the aforementioned windfall by offering AI solutions to its long list of customers. Given its long-term forecast, it seems like it’s only a matter of time before Oracle joins the elite fraternity of multi-trillionaires.
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Danny Vena He has positions in Alphabet, Amazon and Microsoft. The Motley Fool has positions in and recommends Alphabet, Amazon, Microsoft and Oracle. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a feature disclosure policy.
