Oracle Corporation offers products and services that address enterprise information technology environments worldwide. Its Oracle cloud software as a service offering include various cloud software applications, including Oracle Fusion cloud enterprise resource planning (ERP), Oracle Fusion cloud enterprise performance management, Oracle Fusion cloud supply chain and manufacturing management, Oracle Fusion cloud human capital management, Oracle Cerner healthcare, and NetSuite applications suite, as well as Oracle Fusion Sales, Service, and Marketing. The company also offers cloud-based industry solutions for various industries; Oracle application licenses; and Oracle license support services. In addition, it provides cloud and license business' infrastructure technologies, such as the Oracle Database and MySQL Database; Java, a software development language; and middleware, including development tools and others. The company's cloud and license business' infrastructure technologies also comprise cloud-based compute, storage, and networking capabilities; and Oracle autonomous database and MySQL HeatWave, as well as Internet-of-Things, digital assistant, and blockchain. Further, it provides hardware products and other hardware-related software offerings, including Oracle engineered systems, enterprise servers, storage solutions, industry-specific hardware, virtualization software, operating systems, management software, and related hardware services, as well as hardware support products; and consulting and customer services. The company markets and sells its cloud, license, hardware, support, and services offerings directly to businesses in various industries, government agencies, and educational institutions, as well as through indirect channels. Oracle Corporation was founded in 1977 and is headquartered in Austin, Texas.

Oracle Corporation

Pegasystems PEGA is riding on the momentum of its robust cloud business, signaling strong prospects for future revenues. In the second quarter of 2025, Pega Cloud backlog rose 30% year over year to about $1.32 billion, with total backlog reaching $1.84 billion. This growth reflects significant committed business that has yet to be recognized as revenues, ensuring a healthy pipeline for the coming quarters.
Driving this momentum is Annual Contract Value (ACV) growth, which rose 16% year over year to $1.514 billion, while Pega Cloud ACV jumped 28%. This increase underscores strong demand for PEGA’s AI-powered solutions, such as Pega Blueprint and Predictable AI. The company’s pivot to a subscription-based model contributes the majority of its revenues, further enhances predictability, and minimizes reliance on one-time licenses.
Significantly, the current cloud backlog, expected to convert within the next 12 months, grew 28% year over year, offering near-term revenue visibility. Historically, backlog expansion has aligned with steady revenue growth. In early 2024, cloud backlog crossed $1 billion for the first time, and since then, quarterly revenues have consistently trended upward, with second-quarter 2025 revenues up 9% year over year.
With this robust backlog and strategic execution, PEGA appears well-positioned to sustain revenue growth. The Zacks Consensus Estimate for fiscal 2025 and 2026 indicates that revenues will grow 13.71% and 5.83%, respectively, on a year-over-year basis.
PEGA’s Key Competitors in Cloud & Enterprise Software
Pegasystems faces strong competition in the cloud market, particularly from Oracle ORCL and Salesforce CRM.
Oracle is gaining momentum through its expanding Oracle Cloud Infrastructure, supported by a full suite of Oracle Cloud Applications, including its CX platform. It now operates in 23 cloud regions with 47 more planned, reinforcing its global scale. With strengths in AI-driven databases, integrated enterprise solutions, and robust cash flow, Oracle is positioned to compete effectively with Pegasystems and others, while its growing cloud footprint secures the company’s long-term competitive advantage in the enterprise software market.
Salesforce stands as a leader in cloud-based CRM, leveraging its AppExchange marketplace, Einstein AI and scalable SaaS framework to deliver unmatched flexibility. Unlike Pegasystems’ hybrid and on-premise options, Salesforce is fully cloud-native, ensuring seamless access and integration across enterprises. The company consistently wins praise for its intuitive design, rapid adoption and strong third-party ecosystem. With superior usability and a vast developer community, Salesforce continues to set the benchmark in customer engagement and enterprise cloud solutions.
PEGA’s Price Performance, Valuation & Estimates
Pegasystems’ shares have gained 9.7% year to date, while the broader Zacks Computer and Technology sector has returned 10.8% and the Computer-Software industry has risen 16.3%.
PEGA’s YTD Price Performance
Image Source: Zacks Investment Research
PEGA has a Value Score of D. It is currently trading at a forward 12-month price-to-earnings ratio of 24.66X compared to the industry’s 32.73X.
PEGA’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for PEGA’s earnings is pegged at $1.98 per share for 2025, reflecting year-over-year growth of 31.13%, and rising 7.6% over the past 30 days.
Image Source: Zacks Investment Research
PEGA stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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PEGA's Cloud Backlog Climbs: A Sign of Strong Revenue Visibility?

The AI revolution has reshaped the cloud computing landscape, creating unprecedented opportunities for technology giants. Two prominent players, Oracle Corporation ORCL and Alphabet Inc. GOOGL, have emerged as compelling investment options for those seeking exposure to the AI-driven cloud infrastructure boom. Both companies have pivoted aggressively toward AI integration, with Oracle transforming its traditional database business into a cloud-first AI powerhouse, while Alphabet leverages its search dominance and vast data resources to build comprehensive AI solutions across multiple platforms.
The convergence of cloud computing and artificial intelligence has intensified competition between established technology leaders, making their comparison particularly relevant for investors seeking optimal positioning in this transformative sector. Let's delve deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now.
The Case for ORCL Stock
Oracle's transformation from a traditional database company to an AI cloud infrastructure leader has exceeded investor expectations significantly. The company's strategic relationship with ByteDance has triggered the rise of Johor, Malaysia as the world's second largest AI hub, with expansion already underway across multiple countries. Oracle recently revealed a cloud deal that would add more than $30 billion annually, with revenues expected to start hitting in the 2028 fiscal year, demonstrating remarkable ability to secure massive long-term contracts in the competitive AI space.
The Zacks consensus estimate for fiscal 2026 earnings is pegged at is pegged at $6.73 per share, unchanged over the past 30 days.
Oracle's positioning in AI infrastructure has proven exceptionally successful. Larry Ellison recently forecasted over $130 billion of contracts to be booked in the next 12 months, indicating unprecedented demand for Oracle's cloud services. The company's unique approach combines traditional hyperscaler attributes with AI-native capabilities, particularly evident in major partnerships. Oracle expanded its partnership with Google Cloud to offer customers access to Google's most advanced AI models, starting with Gemini 2.5, via Oracle Cloud Infrastructure Generative AI service, creating powerful synergies.
The company's aggressive global expansion strategy demonstrates a serious commitment to AI infrastructure dominance. Oracle plans to invest $2 billion over five years in Germany and $1 billion in the Netherlands to meet growing demand for AI and cloud infrastructure. These investments will significantly expand Oracle Cloud Infrastructure's footprint and AI capacity in key European markets, positioning the company for sustained growth.
However, Oracle faces notable challenges. The company recently cut jobs in its cloud infrastructure unit amid heavy AI spending, suggesting cost pressures despite strong revenue growth. Oracle's smaller scale compared to hyperscaler competitors may limit pricing competitiveness and capacity in certain market segments, potentially constraining long-term market share expansion.
Oracle Corporation Price and Consensus
The Case for GOOGL Stock
Alphabet's position in the AI cloud market represents a comprehensive ecosystem advantage that few competitors can match effectively. CEO Sundar Pichai's claim that nearly all Gen AI unicorns use Google Cloud underscores Google's emergence as the foundational infrastructure layer for the generative AI economy. Google Cloud reported revenues of $13.62 billion for the second quarter, representing 32% growth year over year, demonstrating sustained momentum in the cloud segment while maintaining strong profitability margins.
Alphabet's AI innovation pipeline continues to accelerate across multiple fronts simultaneously. At Google Cloud Next 2025, the company announced Ironwood, its 7th-generation TPU built for inference, offering five times more peak compute capacity and six times the high-bandwidth memory capacity compared to prior generations. The company processed more than 980 trillion monthly tokens across its surfaces, doubling from 480 trillion announced at I/O in May, indicating explosive growth in AI usage and adoption.
The breadth of Alphabet's AI implementation provides multiple revenue streams and competitive moats that strengthen over time. The Gemini App now has more than 450 million monthly active users, with daily requests growing over 50% from the first quarter. Google's integration of AI across Search, YouTube, and Workspace creates a self-reinforcing ecosystem that drives user engagement and advertiser value while defending market position.
Alphabet's financial commitment to AI infrastructure is substantial and strategically focused. The company increased capital expenditures forecast for 2025 to $85 billion, up $10 billion from February, due to strong and growing demand for Cloud products and services, positioning Google Cloud to capitalize on continued AI infrastructure buildout while maintaining technological leadership.
The Zacks consensus estimate for 2025 earnings is pegged at is pegged at $10 per share, up 4.3% over the past 30 days.
Alphabet Inc. Price and Consensus
Valuation and Price Performance Comparison
Both Oracle and Alphabet trade at premium valuations reflecting AI growth prospects, though Alphabet appears more attractively priced across multiple metrics. Alphabet's P/E ratio stands at 19.29x, while Oracle appears overvalued with a value of 33.59x.
ORCL vs. GOOGL: P/E F12M Ratio
Image Source: Zacks Investment Research
Oracle's stock rallied 130% over five years with 150% total return including dividends, while Alphabet posted 176% gains without dividends, demonstrating superior price appreciation and shareholder value creation. Shares of Oracle have returned 41.8% year to date, while Alphabet has returned 7.5% in the same time frame.
ORCL Outperforms GOOGL YTD
Image Source: Zacks Investment Research
Conclusion
While both Oracle and Alphabet offer compelling AI cloud investment opportunities, Alphabet demonstrates superior positioning across multiple dimensions. Google Cloud's dominance among AI unicorns, combined with Alphabet's comprehensive AI ecosystem spanning search, advertising, and enterprise solutions, provides more diversified revenue streams and defensive moats. The company's massive scale enables sustained infrastructure investment while maintaining healthier margins than Oracle's concentrated approach. Alphabet's attractive valuation compared to Oracle's premium pricing, coupled with stronger historical returns and broader market positioning, suggests better risk-adjusted upside potential. Investors should track GOOGL stock for attractive entry points while waiting for better entry opportunities in ORCL. Both ORCL and GOOGL carry a Zacks Rank #3 (Hold) each at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Oracle vs. Alphabet: Which AI Cloud Stock Has Better Upside Potential?

Intel’s INTC revival as a leading chipmaker has gained traction following Tuesday’s announcement that SoftBank SFTBY had taken a nearly 2% stake in the company worth $2 billion.
Furthermore, the Trump administration is reportedly considering a 10% stake in Intel, which could make the U.S. goverment the company’s largest shareholder in a broader effort to strengthen domestic chipmaking capabilities.
To do so, the government would convert funds that Intel received through the CHIPS Act grants into equity, with Intel receiving roughly $11 billion in grants for commercial and military chip production.
With SoftBank helping to lead the large stake investments in Intel, investors may be starting to believe that the chip giant’s revival is ahead. As one of the market’s top performers this month, Intel shares have surged +18% in August, to largely outpace the broader indexes, with Nvidia NVDA and other AI infrastructure-related stocks starting to lose some of their blazing steam.
Image Source: Zacks Investment Research
SoftBank’s Strategic Investment in Intel
Known for its bold bets on tech and innovation, it’s noteworthy that Intel CEO Lip-Bu Tan has deep ties with SoftBank after previously serving on the multinational holding company's board of directors from 2020-2022.
Intel and SoftBank also have collaboration efforts in Saimemory, a startup focused on stacked DRAM (Dynamic Random-Access Memory) chips for AI applications.
Seeing Intel as a critical player in expanding AI chip production, SoftBank is heavily invested in artificial intelligence, having a $500 billion data center project, deemed “Stargate” with OpenAI and Oracle ORCL.
This strategic move also positions SoftBank as a key influencer in global chip supply chains, becoming one of Intel’s largest shareholders and deepening its semiconductor portfolio as the majority owner of ARM Holdings ARM while holding stakes in Nvidia and Taiwan Semiconductor TSM as well.
Why SoftBank’s Lifeline to Intel is So Important
With SoftBank’s investment providing a financial lifeline, this will allow Intel financial flexibility to stabilize its operations after posting a $18.8 billion loss in 2024, the chipmaker's first unprofitable year since 1986. Attributing to last year’s loss, Intel’s foundry division has struggled to secure major clients after losing Nvidia as a customer to Taiwan Semiconductor.
Without these large-scale customers or further outside investments, Intel may have to cancel or halt its mega semiconductor factory in Ohio (Ohio One). Notably, Ohio One is one of the most ambitious tech infrastructure projects in U.S. history, which is another reason the Trump administration has planned to assist Intel, seeing the mega-factory as a way to reduce the nation's reliance on foreign chipmakers.
Tracking Intel’s Outlook & Balance Sheet
Showing signs that its revival may be ahead, Intel’s annual earnings are expected to swing back into the black in fiscal 2025 to $0.15 per share, compared to an adjusted loss of -$0.13 a share last year. Reassuringly, Intel’s FY26 EPS is projected to rebound to $0.68.
On the top line, Intel’s total sales are currently slated to dip over 1% this year, but are projected to rebound and rise 4% in FY26 to $54.2 billion. However, FY26 sales projections would still be well away from Intel’s multi-year peaks of $79 billion in 2021.
Image Source: Zacks Investment Research
Regarding Intel’s financial health, the company has a solid balance sheet, having $192.52 billion in total assets at the end of Q2 compared to $86.76 billion in total liabilities. Plus, Intel has over $21 billion in cash & equivalents as shown in the quarterly chart below.
Image Source: Zacks Investment Research
Monitoring Intel’s P/S Valuation
The price-to-sales ratio (P/S) may be a better way to track Intel's value to investors at the moment rather than the P/E ratio. In this regard, INTC does trade near the preferred level of less than 2X forward sales, with the S&P 500 at 5.5X, and many chip peers such as Nvidia and Taiwan Semiconductor still trading at hefty premiums to these levels.
Image Source: Zacks Investment Research
Bottom Line
SoftBank’s investment in Intel certainly signals confidence in the chip giant’s turnaround and future relevance. That said, after such a sharp rally this month, Intel stock lands a Zacks Rank #3 (Hold), although investors are starting to get more reassurance for what is hopefully a continued rebound at some point.
#1 Semiconductor Stock to Buy (Not NVDA)
The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.
One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.
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Is Intel's Revival Ahead After SoftBank's $2 Billion Investment

Investors considering a purchase of Oracle Corp (Symbol: ORCL) shares, but tentative about paying the going market price of $231.26/share, might benefit from considering selling puts among the alternative strategies at their disposal. One interesting put contract in particular, is the December 2027 put at the $125 strike, which has a bid at the time of this writing of $9.00. Collecting that bid as the premium represents a 7.2% return against the $125 commitment, or a 3.1% annualized rate of return (at Stock Options Channel we call this the YieldBoost).
Selling a put does not give an investor access to ORCL's upside potential the way owning shares would, because the put seller only ends up owning shares in the scenario where the contract is exercised. And the person on the other side of the contract would only benefit from exercising at the $125 strike if doing so produced a better outcome than selling at the going market price. (Do options carry counterparty risk? This and six other common options myths debunked). So unless Oracle Corp sees its shares fall 45.4% and the contract is exercised (resulting in a cost basis of $116.00 per share before broker commissions, subtracting the $9.00 from $125), the only upside to the put seller is from collecting that premium for the 3.1% annualized rate of return.
Worth considering, is that the annualized 3.1% figure actually exceeds the 0.9% annualized dividend paid by Oracle Corp by 2.2%, based on the current share price of $231.26. And yet, if an investor was to buy the stock at the going market price in order to collect the dividend, there is greater downside because the stock would have to lose 45.41% to reach the $125 strike price.
Always important when discussing dividends is the fact that, in general, dividend amounts are not always predictable and tend to follow the ups and downs of profitability at each company. In the case of Oracle Corp, looking at the dividend history chart for ORCL below can help in judging whether the most recent dividend is likely to continue, and in turn whether it is a reasonable expectation to expect a 0.9% annualized dividend yield.
Below is a chart showing the trailing twelve month trading history for Oracle Corp, and highlighting in green where the $125 strike is located relative to that history:
The chart above, and the stock's historical volatility, can be a helpful guide in combination with fundamental analysis to judge whether selling the December 2027 put at the $125 strike for the 3.1% annualized rate of return represents good reward for the risks. We calculate the trailing twelve month volatility for Oracle Corp (considering the last 250 trading day closing values as well as today's price of $231.26) to be 44%. For other put options contract ideas at the various different available expirations, visit the ORCL Stock Options page of StockOptionsChannel.com.
In mid-afternoon trading on Wednesday, the put volume among S&P 500 components was 1.52M contracts, with call volume at 1.52M, for a put:call ratio of 0.72 so far for the day, which is above normal compared to the long-term median put:call ratio of .65. In other words, if we look at the number of call buyers and then use the long-term median to project the number of put buyers we'd expect to see, we're actually seeing more put buyers than expected out there in options trading so far today. Find out which 15 call and put options traders are talking about today.
Also see:
BETR shares outstanding history
Funds Holding FM
CRAY Price Target
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Agree To Buy Oracle At $125, Earn 7.2% Using Options

Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the Invesco S&P 500 Equal Weight ETF (Symbol: RSP) where we have detected an approximate $197.9 million dollar inflow -- that's a 0.3% increase week over week in outstanding units (from 391,910,000 to 392,970,000). Among the largest underlying components of RSP, in trading today Generac Holdings Inc (Symbol: GNRC) is off about 3.4%, Oracle Corp (Symbol: ORCL) is off about 2%, and Invesco Ltd (Symbol: IVZ) is lower by about 0.7%. For a complete list of holdings, visit the RSP Holdings page » The chart below shows the one year price performance of RSP, versus its 200 day moving average:
Looking at the chart above, RSP's low point in its 52 week range is $150.35 per share, with $188.16 as the 52 week high point — that compares with a last trade of $186.20. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Funds Holding PEGA
PEP market cap history
Funds Holding ALJ
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

RSP, GNRC, ORCL, IVZ: Large Inflows Detected at ETF

Key Points
The Nasdaq-100 index recently entered a new bull market after briefly slipping into bear territory in April.
Artificial intelligence (AI) stocks like Nvidia are leading the index higher, so investors who don't own them might be underperforming the broader market.
The Roundhill Generative AI and Technology ETF offers investors a simple way to own a basket of the world's best AI stocks.
The Nasdaq-100 recently shook off a very short-lived trip into bear territory, which occurred after President Trump announced his "Liberation Day" tariffs in April. The index set a fresh record high in June, which marked the official beginning of a new bull market.
The Nasdaq-100 is home to many of the tech giants that are leading the artificial intelligence (AI) revolution. Now that investors feel confident that a global trade war will be averted, they are piling back into these AI powerhouses that continue to generate incredible revenue and earnings growth.
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Investors who haven't owned a slice of the AI industry over the last couple of years have probably underperformed the broader market, but it isn't too late. The Roundhill Generative AI and Technology ETF (NYSEMKT: CHAT) is an exchange-traded fund (ETF) that holds 40 leading AI stocks, and it could be a great addition to any diversified portfolio. The best part is that a single share will cost investors under $60.
Large holdings in some of the world's best AI stocks
The Roundhill ETF invests exclusively in the companies developing the infrastructure, platforms, and software powering the AI revolution. Despite holding 40 different stocks, the ETF is quite top-heavy, with its five largest positions accounting for 25.7% of the total value of its portfolio, and they are among the leaders in those three AI segments:
Nvidia's (NASDAQ: NVDA) advanced graphics processing units (GPUs) for data centers are the most sought-after chips among AI developers. They deliver faster processing speeds and lower energy consumption than anything else on the market, which is why demand consistently outstrips supply.
Alphabet (NASDAQ: GOOGL)(NASDAQ: GOOG) might be known for its dominant Google Search platform, but over 85,000 organizations are using its Gemini large language models (LLMs) to develop their own AI software. Gemini LLMs are accessible through Google Cloud, which also offers access to state-of-the-art data centers powered by Nvidia's GPUs.
Meta Platforms (NASDAQ: META) is using AI in the content recommendation engines across its social media platforms, like Facebook and Instagram. The company also developed the world's most popular open-source LLM called Llama, which it has used to create exciting new products like the Meta AI chatbot.
Microsoft (NASDAQ: MSFT) created a powerful AI assistant called Copilot, which it embedded into its flagship software products like Windows, Edge, and 365. The company also operates one of the world's largest cloud platforms, called Azure, where it offers AI data center capacity to businesses and access to LLMs developed by third parties like OpenAI.
Oracle (NYSE: ORCL) is a leader in AI infrastructure. Its data centers are among the fastest and most cost-efficient in the industry, which is why top developers like Meta, OpenAI, and Elon Musk's xAI are lining up to use them.
Outside of its top five positions, the Roundhill ETF holds a number of other top AI stocks, including Palantir Technologies, Amazon, Broadcom, Advanced Micro Devices, and Apple.
The Roundhill ETF could be a great addition to a diversified portfolio
Investors shouldn't bet the farm on the Roundhill ETF because it's so concentrated, and if the AI boom falters, it could result in some steep losses. It's smarter to add it to a diversified portfolio of other ETFs and individual stocks instead.
The Roundhill ETF was only established in May 2023, so it doesn't have a very long track record for investors to analyze. However, it has delivered an incredible gain of 115% since then, trouncing the S&P 500, which is up by 56% over the same period, and the Nasdaq-100, which has returned 71%. Therefore, it could supercharge a portfolio that doesn't already have a high degree of exposure to the AI boom.
The Roundhill ETF is actively managed, which means a team of professionals regularly buys and sells stocks based on what they think will deliver the best returns. That comes with added costs, which is why the fund has a relatively high expense ratio of 0.75%. Many passive index funds issued by Vanguard have expense ratios as low as 0.03%, so an investment of $100,000 in one of those would incur an annual fee of just $30, compared to $750 for the Roundhill ETF.
This isn't an issue at the moment because the ETF's incredible performance is more than offsetting its costs, but it's something to keep in mind for the long term, especially if its returns start to slip. For now, this ETF looks like a great buy for investors who want to own a slice of the AI revolution.
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Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, Oracle, and Palantir Technologies. The Motley Fool recommends Broadcom and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

1 No-Brainer Artificial Intelligence (AI) ETF to Buy With $60 During the Nasdaq Bull Market

Key Points
Infrastructure software has benefited more from AI investor excitement than application software.
Salesforce and Adobe are struggling to capitalize on AI.
Both companies are still growing and have bargain-bin valuations.
As (by far) the largest sector in the Nasdaq Composite (NASDAQINDEX: ^IXIC), technology has been instrumental in driving the index to new heights. Megacap "Ten Titans" stocks like Nvidia and Microsoft make up a massive share of the tech sector and have continued seeing outsize year-to-date gains.
Dig deeper, and you'll find that many large software companies have undergone sizable sell-offs.
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Salesforce (NYSE: CRM) and Adobe (NASDAQ: ADBE) are down more than 20% year to date despite a 12% gain in the Nasdaq. Here's what's driving the sell-off in these artificial intelligence (AI) growth stocks, and if they could be worth buying now.
AI is challenging the SaaS business model
At its core, what makes AI so exciting is its ability to improve efficiency by allowing companies and individuals to do more with fewer resources. AI can expedite research, provide helpful tips for coding, and accelerate task completion across industries. Large language models (LLMs) created by companies like OpenAI, Microsoft, Alphabet, and Meta Platforms provide a new technological foundation for enterprise software companies.
Salesforce and Adobe became tech giants by carving out a niche in enterprise workflows and selling software as a service (SaaS) -- a model that depends on a growing number of users. Salesforce did it with customer relationship management (CRM) software for sales, services, marketing, analytics, and more. Adobe built its SaaS empire around Creative Cloud -- a portfolio of apps for videos, photos, graphic design, audio, and publishing.
Users doing more with less means enterprises may be able to reduce the number of software subscriptions -- posing a challenge to the SaaS model. And worse yet, if rival companies can replicate some of the tools that Salesforce and Adobe provided, then it could lead some clients to go with a competitor or cancel their subscriptions.
AI is an opportunity for SaaS companies, but it also levels the playing field and erodes the moats of established players. A legacy software giant like Adobe is now more vulnerable than ever to disruption by newer, smaller companies like Canva and Figma, which have their own growing list of AI offerings.
Salesforce could lose market share to Microsoft Dynamics 365, which integrates with the Office 365 software suite and provides CRM and enterprise resource planning services.
Similarly, Oracle's Cloud CX platform competes with Salesforce clouds. Oracle's combination of cloud and database software, along with its CX Platform, gives it a more complete offering than Salesforce.
The market isn't rewarding Salesforce and Adobe for their AI upgrades
So far, many of the beneficiaries of AI investor excitement have been the companies providing the hardware and equipment -- like Nvidia and Broadcom -- and the infrastructure companies that are building software, frameworks, databases, storage, networking, etc. In a figurative sense, these companies are constructing a nationwide highway network to cut commute times and boost commerce.
But you still need cars to drive on the highway, or else it is rendered useless. The advantage of companies like Microsoft and Oracle is that they are building the highway and selling cars. SaaS companies, by contrast, are like automakers going toe to toe in the highly competitive passenger vehicle market.
Still, the application software companies have an incredible opportunity to leverage AI into their existing solutions -- especially through agentic AI, where AI agents help accomplish tasks for the user. These agents act as sophisticated assistants that can speed up workflows.
Despite what their falling stock prices may suggest, Salesforce and Adobe aren't asleep at the wheel when it comes to AI.
Salesforce has a predictive, generative, and agentic AI tools under its Agentforce lineup. Einstein offers a complete suite of AI tools, with a version starting at $25 per month per user and going up to $500 per user per month, not including add-ons.
Adobe has a number of AI assistants, generative AI tools, and agentic AI that help users build, edit, and interact with media. For example, Adobe's AI assistants for Acrobat allow users to interact with documents to generate summaries, reports, emails, texts, and social posts. Adobe Firefly is a text-to-image generator. And Sensei can perform tasks like reframing video footage, filling images for consistency, and predicting trends for marketing content.
Salesforce and Adobe are innovating at an incredible pace -- it's just that their competitors are, too. As a result, Salesforce and Adobe have delivered lackluster growth, showcasing how AI developments haven't directly translated to their earnings.
In its latest quarter -- the first quarter of fiscal 2026 ended April 30 -- Salesforce issued full-year fiscal 2026 revenue guidance of just 8% to 9%, operating cash-flow growth of 10% to 11%, and an operating margin of 34%.
The midpoint of Adobe's updated full-year fiscal 2025 guidance (period ending Nov. 28) calls for just 9.5% year-over-year revenue growth and 11.8% non-GAAP (adjusted) earnings-per-share (EPS) growth.
Overall, their results aren't terrible -- but they are fairly unimpressive compared to the breakneck growth rates of companies that have done a better job converting AI spending into bottom-line results.
Salesforce and Adobe have fallen far enough
Salesforce and Adobe aren't the only application software stocks that are beaten down. Monday.com fell nearly 30% last week. Palo Alto Networks, Autodesk, Datadog, Workday, ServiceNow, and Atlassian are just some of the many application software companies that are down year to date.
When earnings are going up and a stock's price is going down, the valuation becomes more enticing. Sure enough, Salesforce sports a forward price-to-earnings (P/E) ratio of just 21.5, and Adobe has a 17.3 forward P/E. Those are both lower than the S&P 500 (SNPINDEX: ^GSPC) forward P/E of 23.3.
Salesforce and Adobe have their challenges, but these are still great companies. So the fact that they are cheaper than the S&P 500 on a forward earnings basis is a good indicator that the sell-off has gone too far.
Still, buying either stock requires the conviction that the company can continue innovating and succeeding despite the onslaught of new competition. Investors approaching the application software industry should understand that valuations are low for good reasons.
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Annie Dean, a Vice President at Atlassian, is a member of The Motley Fool's board of directors. Daniel Foelber has positions in Adobe and Nvidia. The Motley Fool has positions in and recommends Adobe, Alphabet, Atlassian, Autodesk, Datadog, Microsoft, Monday.com, Nvidia, Oracle, Salesforce, ServiceNow, and Workday. The Motley Fool recommends Palo Alto Networks and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

2 Artificial Intelligence (AI) Growth Stocks Hovering Around 52-Week Lows Even as the Nasdaq Hits New Highs

Oracle (ORCL) closed at $234.62 in the latest trading session, marking a -5.8% move from the prior day. This change lagged the S&P 500's 0.59% loss on the day. Meanwhile, the Dow gained 0.02%, and the Nasdaq, a tech-heavy index, lost 1.46%.
Prior to today's trading, shares of the software maker had gained 2.27% lagged the Computer and Technology sector's gain of 3.91% and the S&P 500's gain of 2.49%.
Market participants will be closely following the financial results of Oracle in its upcoming release. On that day, Oracle is projected to report earnings of $1.47 per share, which would represent year-over-year growth of 5.76%. Alongside, our most recent consensus estimate is anticipating revenue of $15.01 billion, indicating a 12.83% upward movement from the same quarter last year.
ORCL's full-year Zacks Consensus Estimates are calling for earnings of $6.73 per share and revenue of $66.6 billion. These results would represent year-over-year changes of +11.61% and +16.02%, respectively.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Oracle. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.03% lower. Oracle is currently sporting a Zacks Rank of #3 (Hold).
In the context of valuation, Oracle is at present trading with a Forward P/E ratio of 37.02. This indicates a premium in contrast to its industry's Forward P/E of 26.93.
One should further note that ORCL currently holds a PEG ratio of 2.93. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As the market closed yesterday, the Computer - Software industry was having an average PEG ratio of 2.05.
The Computer - Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 82, this industry ranks in the top 34% of all industries, numbering over 250.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Here's Why Oracle (ORCL) Fell More Than Broader Market

Explore the exciting world of Oracle (NYSE: ORCL) with our contributing expert analysts in this Motley Fool Scoreboard episode. Check out the video below to gain valuable insights into market trends and potential investment opportunities!
*Stock prices used were the prices of Jul. 23, 2025. The video was published on Aug. 18, 2025.
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Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Oracle wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $668,155!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,106,071!*
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Anand Chokkavelu, CFA has no position in any of the stocks mentioned. Jose Najarro has positions in Oracle. Travis Hoium has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Oracle. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Oracle: A Risky Bet in the AI Era?

Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Oracle Corp (Symbol: ORCL), where a total volume of 45,751 contracts has been traded thus far today, a contract volume which is representative of approximately 4.6 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 46.1% of ORCL's average daily trading volume over the past month, of 9.9 million shares. Especially high volume was seen for the $190 strike put option expiring September 19, 2025, with 4,685 contracts trading so far today, representing approximately 468,500 underlying shares of ORCL. Below is a chart showing ORCL's trailing twelve month trading history, with the $190 strike highlighted in orange:
Phillips 66 (Symbol: PSX) saw options trading volume of 10,941 contracts, representing approximately 1.1 million underlying shares or approximately 45.8% of PSX's average daily trading volume over the past month, of 2.4 million shares. Especially high volume was seen for the $100 strike call option expiring September 19, 2025, with 3,200 contracts trading so far today, representing approximately 320,000 underlying shares of PSX. Below is a chart showing PSX's trailing twelve month trading history, with the $100 strike highlighted in orange:
And JPMorgan Chase & Co (Symbol: JPM) options are showing a volume of 35,174 contracts thus far today. That number of contracts represents approximately 3.5 million underlying shares, working out to a sizeable 45.7% of JPM's average daily trading volume over the past month, of 7.7 million shares. Especially high volume was seen for the $200 strike put option expiring September 19, 2025, with 2,091 contracts trading so far today, representing approximately 209,100 underlying shares of JPM. Below is a chart showing JPM's trailing twelve month trading history, with the $200 strike highlighted in orange:
For the various different available expirations for ORCL options, PSX options, or JPM options, visit StockOptionsChannel.com.
AMAG market cap history
Top Ten Hedge Funds Holding AWSM
Top Ten Hedge Funds Holding JPED
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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