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Key News Facts
Microsoft (NASDAQ: MSFT) and Oracle (NYSE: ORCL) are witnessing significant growth in their cloud computing sectors due to increasing demand for computing power from companies like OpenAI. Microsoft reported a free cash flow of $25.6 billion in its fiscal fourth quarter and a total of $71.6 billion for the year, while Oracle anticipates a 14-fold revenue increase in its Oracle Cloud Infrastructure by the end of the decade, supported by a $455 billion backlog, which includes OpenAI’s $300 billion commitment starting in 2027.
Microsoft is expected to invest approximately $30 billion in capital expenditures for Azure, while Oracle plans an 18% increase to $35 billion in spending but is facing a negative cash flow of $5.9 billion. Microsoft maintains a more stable position as it has a sufficient cash flow to support its growth, contrasting with Oracle’s reliance on debt to fund its infrastructure expansion.
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