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In Oracle’s first quarter of fiscal 2026, total revenue rose 12% year over year to $14.9 billion, with cloud revenue up 28% to $7.2 billion as its cloud infrastructure business gained traction and RPOs piled up.

“We signed four multi-billion-dollar contracts with three different customers in Q1,” said Oracle CEO Safra Catz in the company’s fiscal first-quarter earnings release. “This resulted in RPO contract backlog increasing 359% to $455 billion. It was an astonishing quarter — and demand for Oracle Cloud Infrastructure continues to build.”

Investors have to pay up for this growth story, too. Oracle trades at a similar valuation multiple to Nvidia. As of this writing, its price-to-earnings ratio is 46.

Both companies give investors direct exposure to AI infrastructure spending, and both stocks look risky at today’s valuations. Nvidia, however, appears better positioned because its business is already delivering rapid growth and strong profitability in a leading AI computing franchise. Sure, Oracle offers meaningful upside if its cloud infrastructure strategy continues to gain share. But there’s no way to know how fast the company will be able to execute on its demand and how certain it is that the company can convert its RPOs into revenue over time.

For investors who want AI exposure but prefer a relatively safer option within this high-risk corner of the market, Nvidia looks like the more compelling choice. Even so, the stock demands patience and a tolerance for volatility, given how dependent its results are on a handful of large customers. In addition, investors should carefully consider the risks of investing in a company that is at the forefront of an unprecedented computing boom that is extremely difficult to predict.

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Daniel Sparks and his clients have no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia and Oracle. The Motley Fool has a disclosure policy.

Better AI Stock to Buy Right Now: Nvidia vs. Oracle was originally published by The Motley Fool