Paramount Global (PARA) Plans $100M Oracle Cloud Deal after Skydance Merger

Business Insider

5 days ago

It's been anything but boring lately at Paramount Studios, unless you count the new musical version of Mean Girls. Between a high-profile merger with Skydance, a $16 million legal settlement with Donald Trump, and the cancellation of Stephen Colbert's late-night show, some optimistic news is finally breaking through.
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Skydance and Paramount Global (PARA) are in talks to sign a new cloud software agreement with Oracle Corp. (ORCL) that could be worth approximately $100 million per year. According to a Bloomberg report, once the merger between Paramount and Skydance is finalized, the new entity will move onto Oracle's cloud infrastructure, supporting large-scale video and content workflows and offering potential cost savings of hundreds of millions over time.
Oracle Deal Set to Streamline Paramount's Cloud Operations
Skydance, which already utilizes Oracle's cloud tools, is expected to expand its footprint once it takes control of Paramount. The arrangement will focus on modernizing Paramount's legacy systems and increasing operational efficiency across content production and distribution.
Oracle's involvement is notable not only for its scale but also for its connection to the transaction. Skydance Media is led by David Ellison, the son of Oracle's co-founder Larry Ellison. Oracle has made recent gains in the cloud infrastructure market by targeting industries that rely heavily on data processing, such as AI development and streaming media. Paramount Global, with its vast archive of video content and live programming from CBS and MTV, fits that profile.
As the merger progresses, the Ellison-led group plans to use technology upgrades and AI-based tools to improve margins and streamline production. Skydance has said it will prioritize automation and smarter backend systems, positioning the company to compete more aggressively with other major streaming and media players.
The Oracle deal aligns with that strategy. It could also give Paramount Global a lift as it continues to manage its sizable debt load and restructuring costs. As of the end of Q1 2025, Paramount reported $14.16 billion in total debt and posted GAAP operating income of $550 million.
Paramount Plans Reboot with Skydance and Oracle
The Skydance-Paramount merger, announced earlier this month, includes more than $8 billion in combined investment. That total covers $1.5 billion for debt reduction and $4.5 billion for the purchase of Paramount shares. The deal is expected to close in the coming months, pending regulatory approval and the expiration of a 45-day period in which other bidders may emerge.
Paramount Global's potential Oracle partnership would follow closely behind the merger, forming one of the largest enterprise cloud transitions in the entertainment industry.
Is Paramount a Good Stock to Buy?
According to The Street's analysts, Paramount boasts a Moderate Sell consensus. The average PARA stock price target is $11.92, implying an 8.52% downside.