From Yahoo Finance: 2025-03-22 09:00:00

Demand for AI hardware has surged in recent years, with global spending expected to hit $337 billion this year and more than double by 2028. Oracle and Dell are poised to benefit from this trend, despite recent stock price declines. Which is the better buy on the dip?

Oracle’s cloud infrastructure revenue soared 51% year over year, outpacing overall revenue growth. With strong demand for its AI cloud services, Oracle’s future growth prospects look promising, supported by a $130 billion remaining performance obligations backlog and plans to double power capacity this year.

Oracle is aggressively expanding its cloud capacity to meet the growing demand for AI services. With the AI server market expected to reach $838 billion by 2030, Dell, the largest player with a 7.2% market share, saw a 29% revenue jump in its infrastructure business last year. Dell aims for a 50% increase in AI server revenue this year.

Despite expectations of 8% revenue growth this year, Dell has a strong position in the AI server market and potential for further growth. The company’s backlog worth $9 billion indicates solid demand. Dell also has an opportunity to capitalize on the AI PC market, potentially accelerating its growth in the future.

Oracle’s robust revenue pipeline and growth projections signal promising years ahead. Its valuation is reasonable compared to tech stocks, while Dell’s future growth relies on PC sales recovery. Investors have a clear choice between these two AI stocks based on growth potential and valuation.

Oracle’s growth trajectory appears positive, with expectations of improved growth rates in the coming years. While Dell may have to wait for its PC business to rebound, its cheap valuation offers a potential upside. Investors should weigh the growth prospects and valuations of both companies before making a decision.

Read more: Better Artificial Intelligence (AI) Stock: Oracle vs. Dell