To The Moon

The Comeback Kid?

On 16 Sep 2025, I had put out a post on $Oracle(ORCL)$’s miraculous comeback on the US stock exchange. click here ! for details.

Strangely enough, this post did not gain as much read-traction unlike my other posts.

One of the post’s highlights was a insightful view by D.A. Davidson, analyst Gil Luria. that ran counter to other analysts’ celebratory remarks about ORCL.

The Falls.

Bare a month since my shared post, ORCL experienced 2 considerable pullbacks, the first on 23 Sep 2025.

This came courtesy of Mr Powell’s first public address, after FOMC’s 17 Sep 2025 interest cut.

The speech, injected uncertainty about further monetary policy support and raised concern that equities, especially in tech and AI, may be overvalued, leading to a broad tech-led pullback after consecutive sessions of record highs.

On 7 Oct 2025, it happened again. ORCL fell by -2.52% or -$7.35, closing at $284.24.

This time it was all because of a report from The Information that had raised questions about ORCL’s plans to buy billions of $NVIDIA(NVDA)$ chips to rent as a cloud provider to clients like OpenAI.

The Information reported that:

• Based on internal document, for the 3 months ending August 2025, ORCL had a 14% gross margins on $900 million in sales in its Nvidia cloud business.

• It is significantly lower than Oracle’s overall gross margin of around 70%.

• ORCL is reportedly losing close to $100 million from renting high-end Nvidia “Blackwell” chips during the period.

• The thin margins cast doubt on (a) ORCL’s strategy to aggressively spend on Nvidia AI chips and (b) the sustainability of ORCL’s bold revenue forecasts tied to large, long-term cloud deals, notably the “Stargate” project with OpenAI.

• ORCL’s recent transformation into one of the most “important” cloud & artificial intelligence companies may run into profitability challenges because of how expensive Nvidia chips are and aggressive pricing on its AI chip rentals.

These revelations undermined optimism about ORCL’s AI cloud growth and signaled to Wall Street that revenue growth is not translating to meaningful profit, prompting investors to sell.

To The Rescue.

Nvidia CEO, Jensen Huang understood the need to nip the “rumours” in the bud to minimize impact to his AI chips.

He decided to take it upon himself to champion about ORCL by expressing strong confidence in ORCL's long-term profitability despite current margin squeeze.

In an interview with Jim Cramer at CNBC's Investing Club:

• Huang said ORCL is "going to do incredibly well".

• He described that while new chips might cause short-term margin pressure, over time the AI cloud business "will be wonderfully profitable". (see below)

Huang’s Argument.

• He emphasized the complexity and scale of building and operating AI data centers, implying that initial profitability challenges are part of the growth phase for large-scale AI infrastructure.

• He suggested that older Nvidia chips rented out by Oracle may already be profitable and that Oracle's overall AI cloud strategy, including its partnership with Nvidia, is solid for the long run.

• By publicly defending ORCL and downplaying fears of sustained losses, he helped reassure investors and the market about the viability and future returns of AI infrastructure investments.

Overall, his comments provided stability to AI-related stocks by framing the margin squeeze as a temporary phenomenon during the growth of a transformative AI cloud market, preventing a broader tech selloff linked to ORCL's issues.

Did It Work ?

I guess the main question is did Jensen Huang’s socialization work ? (see below)

As of 10 Oct 2025

• On 09 Oct 2025, ORCL “recovered” rising +4.48% (or +$8.72) closing at $296.96 per share.

• Both S&P 500 (+0.31%) and Nasdaq (+1.03%) also recovered on Thursday.

• On 10 Oct 2025, all US stocks fell across the board, courtesy of Trump’s tariff’s threat.

Margin concerns highlighted in The Information's report will need a few days of festering for the fears to subside.

It is without a doubt that the decline has been cushioned somewhat, by supportive comments from Nvidia's CEO that followed after.

That’s the clout Nvidia wields, like it or not and why dip buying into Nvidia can be a consideration.

Remember to check out my other posts. (See below). Help to Repost ok, Thanks.

Must Read: Click on below titles to access. Repost to share, Like as encouragement ok. Thanks.

• US Market - Rally or Retreat, This Week ? Mon, 13 October. Pick post.

• Quantum Soaring Twins, RGTI & QBTS - A Buy ? Fri, 10 October. Idea post.

• NIO: Tunnel's End – A "BUY" Signal ? Thu, 09 October. Pick post.

• Do you think NVDA’s CEO has just confirmed that ORCL will be losing money in the short term’?

• Do you think it is better to exit ORCL after it recovered somewhat; just before its next quarterly earnings report is out in December 2025 ?

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