I Own Both Oracle and NuScale for Different Reasons. Here's How They Fit Together.

The four largest hyperscalers, Amazon, Alphabet, Microsoft, and Meta Platforms, will spend $725 billion in capital expenditures this year. UBS projects that over the three years from 2026 to 2028, hyperscalers could spend as much as $4.1 trillion on AI infrastructure.

Oracle (NYSE: ORCL) and NuScale Power (NYSE: SMR) are two stocks I own that play different roles in the AI build-out. Compute and power are both valuable, scarce resources in this evolving AI world, and Oracle and NuScale Power could both benefit. Here's what investors need to know.

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Oracle and NuScale Power have this in common

Oracle and NuScale Power are separate companies with no contractual links or partnerships. That said, both stocks are at the intersection of AI data centers and next-generation power.

Oracle focuses on artificial intelligence and cloud infrastructure. As with most hyperscalers, the company faces major electricity constraints because next-generation AI infrastructure requires significantly more power for training and inference.

In September 2024, Chairman Larry Ellison publicly stated that Oracle is designing multi-gigawatt (GW) data center campuses to be powered by small modular reactors (SMRs). NuScale Power manufactures SMRs, and its NuScale Power Module is the only SMR to receive standard design approval from the Nuclear Regulatory Commission (NRC).

Oracle is seeing staggering demand for cloud infrastructure

The investment theses for Oracle and NuScale hinge on different factors. Oracle has pivoted aggressively into providing cloud infrastructure for hyperscalers. The company's remaining performance obligation, which includes massive commitments from frontier AI developers, has surged 363% year over year to $638 billion.

The company is experiencing staggering growth in cloud infrastructure, with revenue from this business increasing 93% from last year to $5.8 billion. During its fourth quarter (ending May 31), Oracle signed $67 billion in AI infrastructure contracts. The company has expanded on agreements with Amazon Web Services and Google Cloud, and its multi-cloud database revenue exploded 404% year over year.

Investor concerns have emerged around Oracle's massive data center expansion strategy. In fiscal year 2026, the company generated $32 billion in operating cash flow while spending $55.7 billion on capital expenditures. The company also has over $122 billion in debt. If its data centers don't open on schedule, revenue could be delayed while capex and interest spending remain high.

That said, the stock has taken a big hit in the past year and is down 54% from its 52-week high. Analysts project solid growth ahead, with earnings per share expected to grow 36% in 2027 and another 39% in 2028.

NuScale develops next-generation nuclear reactors and has experienced significant volatility

NuScale Power is a start-up in the nuclear energy sector, focusing on SMRs that could transform the way we use nuclear energy. The stock has also been highly volatile, and today it trades 83% off its 52-week high of $57 per share. For aggressive investors looking to play the growth in nuclear power and advanced SMRs, NuScale's stock looks far more appealing today than it did one year ago.

NuScale has fallen for a couple of reasons. For one, its largest shareholder, Fluor, sold its position in the nuclear start-up from the end of last year through early 2026. On top of that, NuScale has yet to secure any firm commitments beyond its project in Romania.

That could all change soon. NuScale is working with ENTRA1 Energy to help it deploy its SMRs at scale. ENTRA1 will serve as a developer, financier, and owner of ENTRA1 Energy Plants, powered by NuScale SMRs.

ENTRA1 could help NuScale secure a massive agreement with the Tennessee Valley Authority (TVA). Last year, the parties entered into a collaborative agreement to explore deploying up to 6 GW of NuScale's SMRs. The move helps NuScale deploy its technology, but it has also faced scrutiny over milestone payments that could reach up to $4 billion.

No firm commitment has been made. NuScale's management hopes to secure a deal before the end of this year, which could be a massive catalyst for NuScale's beaten-down stock.

Should you buy the dip in Oracle and NuScale?

Oracle is directly tied to data center demand, but faces risks if demand fails to keep pace with its massive cloud infrastructure expansion. NuScale is a highly speculative play on the future of nuclear energy, and its NuScale Power Modules won't be deployed until the 2030s.

Because of these risks, both stocks have taken a beating this year after staggering returns in 2025. That said, the dip has made both stocks more appealing to long-term investors seeking exposure to the booming growth in artificial intelligence and related power demand.

Courtney Carlsen has positions in Alphabet, Meta Platforms, Microsoft, NuScale Power, and Oracle. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, Microsoft, and Oracle. The Motley Fool recommends NuScale Power. The Motley Fool has a disclosure policy.