Oracle Corp (NYSE:ORCL) is trying to balance an ambitious expansion plan with investor skepticism as it builds out its AI future and reshapes its physical footprint.
Oracle Pushes Nashville As A Future Growth Hub
It is pushing to build Nashville into a major hub for its future, even as it faces challenges attracting enough workers.
The company is advertising more open roles in Nashville than in any other U.S. city, with a heavy focus on cloud infrastructure jobs that sit at the center of its growth strategy, Bloomberg reported on Thursday.
Chairman Larry Ellison committed the company to creating 8,500 jobs in the city by 2031 under a 2021 tax incentive deal.
Despite that push, Oracle still employs only about 800 workers in Nashville, according to Bloomberg.
To accommodate future growth, Oracle plans a massive campus along the Cumberland River with more than 2 million square feet of office space, a new pedestrian bridge, and a Nobu restaurant.
Stock Slides As AI Spending Faces Scrutiny
Oracle shares have fallen close to 40% over the past three months, putting the stock on track for its worst quarterly performance since 2001.
Jefferies analyst Brent Thill said the selloff reflects growing concern that Oracle’s near-term outlook is increasingly tied to the financial strength of OpenAI, its largest and least transparent partner.
Thill told CNBC that markets have shifted from broad “AI hype” to an “AI show me” phase, where investors want clear revenue visibility to justify rising capital expenditures.
He warned that Oracle’s margins are under pressure at the same time CapEx continues to climb.
During the current quarter, Oracle shares dropped by over 31% to ~$198 by late December.
Despite the near-term weakness, Jefferies remains constructive on the longer-term story.
Thill said he expects the AI market to consolidate around a few dominant players, including Alphabet Inc (NASDAQ:GOOGL) Google, OpenAI, and Anthropic.
ORCL Price Action: Oracle shares were up 1.03% at $195.61 at the time of publication on Thursday, according to Benzinga Pro data.
Photo by JRdes via Shutterstock
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