On September 14, Oracle fell 3.21% in pre-market trading, trading at approximately $145.53 per share, with turnover of $24.41 million. The decline follows Morgan Stanley reaffirming its Neutral rating and $210 price target, warning that rising cloud infrastructure revenue mix will structurally compress overall gross margins.

Morgan Stanley analyst Sanjit Singh noted that while Oracle delivered strong FY2027 Q1 results — revenue of $19.35 billion (+30% YoY), cloud infrastructure revenue surging 121% to $7.4 billion, and adjusted EPS of $1.92 beating the $1.74 consensus by over 10% — gross margin performance was underwhelming due to capacity expansion. The bank flagged that GPU-as-a-service economics and free cash flow conversion remain key hurdles before turning constructive, particularly as quarterly capital expenditure of $28.5 billion drove free cash flow to negative $5.4 billion.

Adding to selling pressure, multiple analysts cut price targets post-earnings, including RBC (to $165), BMO (to $195), and Stifel (to $200). Although founder Larry Ellison canceled a planned $7.5 billion stock sale, profit-taking continued after the stock reversed from an intraday 8.5% surge on September 11.

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