Oracle announced that it would ramp-up hiring to expand footprint in cloud, while Jefferies slashed their price target on the company’s stock.
Oracle plans to open around 20 more cloud data centers by the end of next year - a move that's expected to help customers to safely store data for disaster recovery or to comply with local data storage laws. The cloud company currently has such centers in 16 regions, including a dozen that it opened in the past year. New locations will be built in Chile, Japan, South Africa and United Arab Emirates as well as elsewhere in Asia and Europe. The expansion could be seen as an effort on Oracle’s part to bolster its presence in the near $40 billion market for cloud computing and storage.
Oracles’ plans to up the ante on its cloud business will create an additional 2,000 jobs in the company, according to Oracle. Jobs will be added in Oracle’s software development hubs in Seattle, the San Francisco Bay Area and India, as well as near new data centers, said Don Johnson, executive vice president of the Oracle Cloud Infrastructure unit (as mentioned in a Reuters report).
Separately, Jefferies analyst Brent Thill downgraded Oracle shares to hold from buy, and also lowered his price target on the shares to $66, a $6 reduction from the prior level. Thill noted that the company has "lost ground in the infrastructure business as workloads migrate to the cloud." On the other hand, Microsoft shares got a price target boost (to $160 from $93 per share) from Thill, as he believes that there is a "clear line of sight into double-digit revenue growth for the foreseeable future", for Microsoft.