Oracle Corporation 's ORCL recent announcement of an AI Centre of Excellence in Singapore appears to be a desperate attempt to maintain relevance in the increasingly competitive cloud and AI landscape across Southeast Asia. The initiative, revealed on March 13, comes at a critical time when Oracle faces mounting challenges that investors should not ignore.
Financial Warning Signs Mount
Oracle's third-quarter 2025 earnings revealed troubling indicators that the company is struggling to meet expectations despite the AI boom benefiting competitors. The company reported EPS of $1.47, missing estimates by 2 cents, while revenues of $14.13 billion (up 6.40% year over year) fell significantly short of projections by $259.18 million. These disappointing results expose Oracle's inability to capitalize effectively on the current AI revolution despite its claims.
The company's software license revenues dropped 8% to $1.1 billion, indicating Oracle's continuing struggle to transition its legacy business to the cloud. Strategic SaaS applications grew at a meager 8%, far behind the explosive growth rates seen by competitors like Microsoft and AWS in the region.
Regional Competitive Pressure Intensifies
While Oracle attempts to make inroads with its Singapore AI Centre,
Amazon
AMZN-owned AWS has committed a substantial $8.3 billion investment specifically for cloud infrastructure in Maharashtra, India, as part of a larger $12.7 billion planned investment across India by 2030. This capital infusion dwarfs Oracle's regional ambitions and demonstrates the gulf in financial firepower between the competitors.
Additionally, AWS' projected contribution of $15.3 billion to India's GDP and support for more than 81,300 full-time jobs shows the true scale gap between the companies.
Microsoft
MSFT similarly announced in March 2025 a planned launch of its Indonesia Central cloud region in second-quarter 2025, with a reported $1.7 billion investment to advance Indonesia's cloud and AI capabilities.
Alphabet
GOOGL-owned Google has further intensified competitive pressure with its announcement of a $1 billion investment in data centers in Thailand, projected to boost the local economy by $4 billion and create 14,000 jobs by 2029. This strategic move strengthens Google's already substantial footprint in the region, leaving Oracle struggling to remain relevant.
Technical Limitations Undermine Oracle's Position
Despite CEO Safra Catz's claims that Oracle Cloud is "faster and, therefore, cheaper than our competitors," the reality remains that Oracle's OCI infrastructure serves only a fraction of the workloads handled by AWS, Azure, and Google Cloud. The announcement of Oracle's "101st cloud region" rings hollow when considering that these regions are substantially smaller and offer fewer services than competitors' facilities.
Lawrence Ellison's boast about a "gigantic 64,000 GPU, liquid-cooled NVIDIA GB 200 cluster" pales in comparison to the massive AI infrastructure already deployed and operational across multiple regions by hyperscalers. Amazon's SageMaker AI platform, now available in Malaysia, offers a fully managed, production-ready ML service that Oracle simply cannot match in capability or scale.
Investment Outlook: Negative
Oracle's AI Centre announcement appears more as public relations than substantive investment. The company failed to disclose specific capital commitments, while AWS and Microsoft have publicly detailed billions in regional investments. This lack of transparency should concern investors evaluating Oracle's long-term regional strategy.
The company's reported backlog growth to $130 billion remains questionable, especially given the continued compression in operating margins and the high capital expenditure requirements needed to remain competitive in the AI race. With third-quarter operating cash flow barely covering capital expenditures, Oracle's ability to fund true AI innovation appears increasingly constrained.
Investors should view Oracle's AI Centre announcement with extreme skepticism given the company's deteriorating financial metrics, intensifying regional competition, and technical limitations. The stock appears significantly overvalued considering these fundamental challenges, making it a strong sell candidate for 2025 as dominant cloud providers continue consolidating their advantages in the critical Southeast Asian market.
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