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Why Potential TikTok Ban Threatens Cloud Business

@TigerOptions
$Oracle(ORCL)$ finds itself in a precarious situation as the ongoing saga of TikTok's ownership unfolds. The company recently acknowledged in its annual report that a potential U.S. ban on TikTok could negatively impact their business. As someone who closely monitors ORCL, this news raises some concerns. Oracle currently provides cloud infrastructure for TikTok, a service that likely generates significant revenue for them. While the exact details haven't been disclosed, estimates suggest Oracle could be earning hundreds of millions annually from TikTok's cloud usage. This represents a valuable chunk of their overall cloud revenue, which sits at $6.9 billion for the fiscal year. If the U.S. government enforces a ban on TikTok, Oracle stands to lose this lucrative cloud contract. The report suggests they might not be able to readily redeploy that capacity, further impacting their bottom line. This is a significant risk for investors to consider. The situation is further complicated by the ongoing legal battle between TikTok and the U.S. government. While Oracle has a partnership in place, a potential change in ownership or the app's functionality could significantly alter the terms of their agreement. ORCL support level: 137.50 My Take: ORCL a Hold for Now The potential loss of the TikTok contract and the overall uncertainty surrounding the situation make me hesitant to invest in ORCL at this time. While their cloud business is growing, losing a major client like TikTok could be a significant setback. I'll be closely monitoring developments related to the TikTok ban and how it impacts Oracle's cloud business before making any investment decisions. Disclaimer: This is not financial advice. Do your own research before making any investment decisions.
Why Potential TikTok Ban Threatens Cloud Business

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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