Oracle Corporation (ORCL) Fell Along with the Technology Sector

Ariel Investments, an investment management company, released its “Ariel Focus Fund” first-quarter investor letter. A copy of the letter can be downloaded here. At the end of the first quarter of 2025, most major U.S. indices recorded losses as investors sought safety. Initial optimism for another strong year of U.S. performance, fueled by economic momentum and the new administration’s pro-business policies, faded as concerns over tariffs and uncertainty in policy direction. In the environment, the fund returned -3.88%, lagging the Russell 1000 Value Index’s +2.14% gain, and ahead of the S&P 500 Index’s -4.27% return. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Ariel Focus Fund highlighted stocks such as Oracle Corporation (NYSE:ORCL). Oracle Corporation (NYSE:ORCL) offers products and services that address enterprise information technology environments. The one-month return of Oracle Corporation (NYSE:ORCL) was 10.65%, and its shares gained 26.12% of their value over the last 52 weeks. On June 11, 2025, Oracle Corporation (NYSE:ORCL) stock closed at $176.38 per share, with a market capitalization of $494.61 billion.

Ariel Focus Fund stated the following regarding Oracle Corporation (NYSE:ORCL) in its Q1 2025 investor letter:

“Lastly, global leader in enterprise software, Oracle Corporation (NYSE:ORCL), traded lower alongside the broader technology sector due to macroeconomic uncertainty and in particular, the near-term prospects for artificial intelligence investment (AI) spending. As a result, ORCL reported weaker than expected quarterly earnings results. Nonetheless, management expects double-digit growth for fiscal 2026 and 2027, citing significant demand for its cloud and AI capabilities. This supports our view that ORCL’s positioning as the leading provider of database software and cloud-based infrastructure is entrenched, making it a key beneficiary of global demand for generative AI development.”

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Oracle Corporation (NYSE:ORCL) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 97 hedge fund portfolios held Oracle Corporation (NYSE:ORCL) at the end of the first quarter, which was 105 in the previous quarter. While we acknowledge the potential of Oracle Corporation (NYSE:ORCL) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Oracle Corporation (NYSE:ORCL) and shared the list of stocks on Jim Cramer’s radar. The Q1 2025 investor letter of Carillon Eagle Growth & Income Fund cited the same reasons for Oracle Corporation’s (NYSE:ORCL) decline. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.