President Donald Trump’s Stargate foray could present a major boon for these technology companies, according to Wall Street. The $500-billion joint venture between OpenAI, Oracle and SoftBank announced earlier this week aims to beef up artificial intelligence infrastructure in the U.S. Shares of Oracle and Microsoft have rallied nearly 15% and 3%, respectively, since the start of the week. Microsoft is an investor in OpenAI. ORCL 5D mountain Oracle shares over the last five trading days Wall Street views the move as an overall positive for the industry, with Citi’s Tyler Radke noting it should support strong capital expenditures by buoying demand for for greater inference and training capacity. The project also requires more computing and electricity which could lead to greater investments in grid infrastructure and power transmission, said UBS’ Solita Marcelli. Goldman Sachs analyst Kash Rangan views Oracle and Microsoft as the prime winners from the government’s prioritization of AI. Near term, Rangan views Microsoft as the likely bigger winner given its strong balance sheet and capital expenditures for 2025. Tailwinds for Oracle may take longer, the analyst said, citing the two- to three-year “lead time commitment” for operating AI datacenters. TD Cowen’s Derrick Wood expects the agreement to lead to more capital AI investments for Oracle, which should benefit from a diversion of some OpenAI’s training workloads away from Microsoft. This should also lead to a new backlog for Oracle and help the company boost its cloud infrastructure revenues at a compounded annual growth rate exceeding 50% through 2027. For Microsoft, unloading some of its OpenAI training workloads will enable the company to use more graphics processing units for inference and improve capital expenditure efficiencies, he added. “These dynamics should help with MSFT’s efforts to ease supply constraints, bring more revenue-generating AI capacity online, & re-accelerate Azure growth towards the mid 30% level,” Wood wrote. Microsoft and Oracle are far from the only winners from the Stargate venture. Piper Sandler’s James Fish highlighted Arista Networks as a potential winner, noting its exposure to Oracle, Microsoft and OpenAI, as well as the strength of its ethernet switching portfolio. “Given switching represents > 50% of networking spend and Arista’s > 30% share of high-end datacenter switching, we see this as a +$6B [serviceable addressable market] over 5 years,” the analyst wrote. Fish also views Pure Storage as an “underappreciated way” to invest behind Stargate to meet storage capacity, estimating a $10 billion total addressable market.
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