Oracle's Value Halved from 2025 Peak as AI Caution Grows
Technology giant Oracle's market value has declined by approximately half since reaching its peak in 2025. Financial analysts indicate that this sharp drop stems from concerns about the company's position in the AI race and rising operational expenditures. Industry observers are closely monitoring the traditional database leader's transformation journey.
A significant correction is underway in the global technology and cloud computing sector. The market value of Oracle, a leading name in enterprise software, has eroded by approximately 50% since its historic peak recorded in early 2025. This striking decline highlights the deepening concerns of investors and market analysts regarding the company's competitive position in artificial intelligence (AI) and its high-cost structure.
From Peak to Trough: Oracle's Turbulent Year
Oracle, founded in 1977, has long been recognized for its dominance, particularly in the enterprise database market. The company became a global player by entering the Chinese market in 1989 and earned the title of the largest enterprise software company in 2013 by surpassing industry giant IBM. However, as the technology world rapidly evolves in the age of cloud computing and artificial intelligence, this leadership based on traditional infrastructure has begun to be questioned.
Analysts point to several key factors behind Oracle's loss in value. Foremost among these is the risk of the company falling behind its competitors in the artificial intelligence and cloud technology race. While rivals like Amazon AWS are increasingly gaining market share in the database sector, Oracle's pace in transitioning to these next-generation platforms has not satisfied investors.
Uncertainty in the AI Race and High Costs
Developments in artificial intelligence, particularly in the field of generative AI, have created a new competitive arena for technology companies. Although Oracle has announced it is developing AI tools for areas such as drug design for cancer diagnosis and image analysis, the market is taking a cautious stance regarding the scalability and commercial success of these efforts. According to Gartner's estimates, enterprise AI usage will reach 30% by 2025, but Oracle's share of this pie remains unclear.
Another critical point is the company's cost structure. Oracle's transition from its traditional licensing and hardware-focused business model to a subscription-based cloud model requires significant investment. These rising operational expenditures, coupled with intense competition, are putting pressure on profit margins. Financial reports indicate that while cloud revenue is growing, it has not yet compensated for the decline in traditional software sales at the expected pace.
Market experts state that for Oracle to regain investor confidence, it must more clearly demonstrate its AI strategy and prove it can achieve sustainable growth in the cloud domain. The coming quarters will be critical in determining whether this technology veteran can successfully navigate its transformation or face further market value erosion.
