Friday's pre-market news: Oracle (ORCL) surged due to cloud business growth, while Adobe (ADBE) fel

Core Highlights

Oracle delivered a brilliant report card, Cloud business accelerates growth

Adobe's performance exceeds expectations but its share price still falls

Copart plans to acquire ACV Auctions

Other market developments

Oracle's share price surged more than 7% after releasing impressive first-quarter results for the fiscal year, with cloud revenue rising 62% year-on-year. Although Adobe's results exceeded expectations, its share price fell about 3%, mainly due to continued concerns about artificial intelligence (AI). Copart announced its acquisition of ACV Auctions for approximately $1.9 billion, sending ACV shares up 44%. RH shares rose 8.2%, driven by better-than-expected profit results and optimism about market expansion. Futures contracts climbed slightly in early Friday morning as crude oil prices retreated and traders awaited August inflation data.

Futures contracts edged higher

Stock index futures gained support in early trading on Friday as crude oil prices fell and market participants looked forward to upcoming August inflation data. These data are expected to influence future U.S. monetary policy decisions.

During the pre-market trading session, many well-known stocks experienced significant price fluctuations.

Oracle delivers outstanding report card, cloud business accelerates growth

Oracle's share price rose more than 7% before the market after releasing first-quarter financial results that exceeded analysts 'expectations. Overall revenue increased 30% from the same period last year, while cloud-related revenue surged 62% to $11.6 billion. Oracle Corporation, ORCL

Revenue from the infrastructure sector soared to US$7.4 billion, an increase of 121%. In addition, the company disclosed that its remaining performance obligations reached $664 billion, an increase of $209 billion, including more than $30 billion in new AI cloud agreements.

During the quarter, Oracle deployed more than 300,000 GPUs to its AI cloud customers. These strong numbers help allay investor concerns about the company's relationship with OpenAI.

Looking to the second quarter, Oracle expects revenue to be between $20.88 billion and $21.52 billion. Management also announced revenue forecasts of no less than US$90 billion for fiscal 2027, exceeding Wall Street estimates.

Adobe beat expectations but stock price still fell

Adobe reported third-quarter results for the fiscal year that exceeded forecasts, but its stock price still fell by about 3.7%. Adjusted earnings per share were $6.13,$0.05 above forecasts, and revenue rose 13% year-on-year to $6.76 billion.

The company's subscription revenue totaled $6.58 billion, and annual recurring revenue climbed to $27.5 billion. Adobe also raised its full-year profit forecast.

However, continued investor anxiety about the impact artificial intelligence may have on Adobe's core business model has put downward pressure on stock prices. Due to these AI-related uncertainties, the stock has faced long-term headwinds.

For the upcoming fourth quarter, Adobe expects revenue to be between $6.8 billion and $6.85 billion, slightly below the median of analysts 'expectations.

Copart plans to acquire ACV Auctions

Copart reached an all-cash transaction agreement to acquire ACV Auctions for $10.50 per share, valued at approximately $1.9 billion. The proposal is about 45% higher than ACV's close price on August 10, and there have been no takeover rumors before.

ACV Auctions shares surged 44% after the announcement, and Copart shares rose about 7%.

Copart plans to use existing cash reserves to fund the acquisition. The boards of directors of both companies have approved the transaction and is expected to be completed before the end of 2026, subject to regulatory approval.

The acquisition is expected to be revenue neutral in its first full fiscal year and to increase revenue starting in fiscal 2028.

Other Market Developments

RH, the luxury furniture company's shares surged 8.2% after exceeding its second-quarter profit forecast. Management said recent brand diversification initiatives could double the company's accessible market opportunities.

Energy stocks such as Chevron and ExxonMobil fell as U.S. crude oil futures fell below the $100-barrel mark.

Zumiez shares plunged 16%, after the specialty retailer disclosed a larger-than-expected second-quarter loss and reported a 2.5% decline in revenue.