Oracle (ORCL)
Oracle shares rose more than 8% in premarket trading after the software company announced cloud deals with Google (GOOG) and OpenAi.
“In the fourth quarter alone, Oracle signed more than 30 AI sales deals totaling more than $12.5bn (£9.8bn), including a deal with OpenAi to train ChatGPT on Oracle Cloud,” CEO Safra Catz said.
The company also announced it will bring its databases to Google’s cloud, available from November, allowing companies to deploy workloads across Google and Oracle cloud data center regions without paying data transfer fees.
“In the third and fourth quarters, Oracle closed its largest sales deal in history, fueled by massive demand for training AI large-scale language models on Oracle Cloud,” Catz added.
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Despite that, Larry Ellison’s company’s fourth-quarter results fell short of Wall Street expectations.
Total revenue increased 3% to $14.29 billion. Net income was $3.14 billion, or $1.11 per share, down from $3.32 billion, or $1.19 per share, in the year-ago period.
The company generated $10.23 billion in revenue from cloud services and license support in the latest quarter, up 9% from the prior year.
Oracle reported 6% growth in total revenue for fiscal 2024. Analysts expect 9% growth for fiscal 2025.
The company expects first-quarter revenue to grow 5% to 7%, while analysts are expecting a 7.6% increase.
Apple shares hit a new record high on Tuesday, closing up 7%, but fell in premarket trading as its AI announcements continue to divide analysts.
The iPhone maker is back in the AI game with the launch of Apple Intelligence at its global developers conference, and also said that users will soon be able to take advantage of OpenAi’s ChatGPT when using Siri.
At least 13 analysts raised their price targets for Apple’s stock after the developer event, saying the company’s latest features could boost sales as it prepares to unveil new iPhones this fall.
“It was a historic day for Apple and Cook & Co. and was not a disappointing one in our view,” Wedbush analyst Daniel Ives told investors in a research note.
Ives, who maintained his outperform rating and $275 price target, said, “The entire tech industry is focused on long-awaited AI strategies and further updates in both the hardware and software ecosystem that will drive the next growth cycle over the next few years.”
“Apple is demonstrating its investment in evolving its platforms and devices to enable the next generation of computing, interfaces and experiences,” said Gartner analyst Tuong Nguyen.
Elon Musk has threatened to ban his company from using Apple products due to security concerns.
Paramount (PARA)
The company’s shares plummeted and continued to fall during premarket trading hours after the media mogul who controls Paramount Pictures backed out of a multibillion-dollar merger after months of negotiations.
Shari Redstone has broken off negotiations with Skydance Media over a merger that would have handed control of Paramount from her family to billionaire David Ellison.
Skydance had offered roughly $2 billion to acquire Redstone’s National Amusements (NAI) and would then merge Paramount into Ellison’s company through a stock deal.
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Skydance was also prepared to buy about half of Paramount’s common stock for $15 a share and inject about $1.5 billion into the company to help pay down its debt.
A statement from National Amusements noted only that the two sides “were unable to reach mutually acceptable terms” on the deal.
Paramount has struggled in an evolving media environment, especially as its traditional cable business declines.
Legal & General (LGEN.L)
Shares in the insurance, retirement and investment services group fell sharply after Chief Executive Antonio Simoes announced a shake-up to deliver a “simpler, more connected L&G”.
The changes include combining Legal & General Investment Management with the group’s overall investment division to create a single asset management division, as well as considering the sale of certain assets, such as housebuilder Kara.
The group’s main business, institutional pension insurance, which buys old pension plans, and its core insurance retail division with 14 million customers will remain.
But the firm plans to aggressively pursue up to £65 billion of corporate pension transactions in the UK by 2028, after doing £13.7 billion globally last year.
The company has said it intends to increase shareholder returns between 2024 and 2027, by increasing its dividend by 5% in 2024 and 2% each year thereafter, as well as carrying out a £200 million share buyback.
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