Oracle Beats Revenue Estimates as AI Demand Drives 121% Cloud Infrastructure Growth
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Oracle's quarterly revenue beats estimates as AI boom drives cloud demand
Sept 10 (Reuters) - Oracle (ORCL.N), opens new tab topped Wall Street expectations for first-quarter revenue on Thursday and lifted its annual profit forecast, boosted by strong demand for its cloud computing services from surging enterprise spending on AI. Shares of the company, which have fallen
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Surging cloud revenue boosted Oracle's quarterly results. Here's what analysts are saying
Oracle trounced analysts' expectations in its latest quarter, powered by a jump in cloud revenue and growing artificial intelligence demand. In its fiscal first-quarter release, Oracle reported revenue of $19.35 billion , up nearly 30% from the year-ago period, while adjusted earnings rose 30% to
[3]
Oracle options are doing something curious heading into earnings
Follow your favorite stocksCREATE FREE ACCOUNT watch now VIDEO3:0403:04 Oracle calls are trading a lot richer than puts ahead of earnings, says IG Group's Julia Spina Power Lunch If ever there were a stock that captured the hopes and fear of the AI trade, it's Oracle. Shares have fallen 17%
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Oracle Stock Jumps as AI Demand Drives Cloud Revenues Higher
Get personalized, AI-powered answers built on 27+ years of trusted expertise. Oracle's stock is surging on gains in its cloud infrastructure business. Shares of Oracle were up more than 6% in extended trading Thursday, rising after the database and cloud infrastructure giant posted quarterly
[5]
Oracle rises as AI-fueled backlog growth deflects spending worries
Oracle shares rose 3% in early trading after a $26 billion increase in its revenue backlog eased concerns over its debt-funded AI spending. Strong earnings and an improving balance sheet also supported the stock, though analysts warned that a meaningful recovery in Oracle's cash flow could still
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Oracle's Biggest AI Risk May No Longer Be Spending - Oracle (NYSE:ORCL)
Oracle Corp's (NYSE:ORCL) multibillion-dollar AI infrastructure buildout has spent the past year under intense investor scrutiny, with concerns centered on soaring capital expenditures and negative free cash flow. But according to one veteran technology analyst, the debate is shifting. The bigger
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Oracle earnings show slower cash burn as AI spending starts to pay off; stock jumps 4% after market
Oracle's latest earnings offered investors relief as stronger-than-expected revenue and a smaller cash burn eased concerns over its heavy AI spending. The company's revenue backlog surged to $664 billion, while customer prepayments helped fund capital expenditure. Oracle shares rose 4% after market
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Morgan Stanley maintains Equal-weight on Oracle after earnings
Oracle (ORCL) has been a goliath in enterprise technology for decades. Lately, Oracle Cloud Infrastructure (OCI) has emerged as the primary growth engine because of the AI boom. Oracle just delivered a very solid quarter. Cloud infrastructure revenue grew 121% year over year. Total revenue hit
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Oracle shares rally: Can strong AI demand sustain Oracle's stock surge? - Oracle stock surges after strong Q1 results
Oracle shares rally: Can strong AI demand sustain Oracle's stock surge? 1/7 Oracle stock surges after strong Q1 results Oracle shares jumped in after-hours trading after the software giant reported stronger-than-expected fiscal first-quarter results, with booming AI demand driving rapid growth
[10]
Oracle earnings analysis: questions answered and next catalysts By Investing.com
Investing.com -- Oracle's earnings answered the demand question decisively: OCI revenue surged 121% and RPO reached $664B. The next test is financial: can Oracle convert that backlog into cash while CapEx remains near $90B-$95B? Demand Cleared The Bar Strong execution: Oracle Corporation (ORCL)
[11]
Oracle earnings report: Oracle tops estimates as AI demand tempers cash-burn fears
Shares of the company, which have slumped more than 21% this year, rose 4% in extended trading after Oracle reported a jump in revenue backlog, a key metric on future revenue growth prospects. Oracle topped Wall Street estimates for quarterly results on Thursday and reported a smaller cash burn
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Why is Oracle stock surging today? By Investing.com
Investing.com -- Oracle Corporation stock surged 7.2% in pre-open trading after the enterprise software and cloud giant reported fiscal first-quarter 2027 results on the evening of September 10 that exceeded Wall Street's expectations on both the top and bottom lines. Total revenue reached $19.35
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Oracle earnings: AI growth, OpenAI deal and $20 billion funding plan - Oracle earnings: AI boom meets funding test
Oracle earnings: AI growth, OpenAI deal and $20 billion funding plan 1/6 Oracle earnings: AI boom meets funding test Oracle heads into its upcoming earnings with investors closely watching the rapid expansion of its AI cloud business. At the same time, the company faces growing funding
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Oracle fiscal Q1 2027 earnings preview: AI backlog conversion in focus By Investing.com
Investing.com -- Oracle reports fiscal Q1 2027 after the close today, with consensus at $1.73 EPS and $19.13B revenue. The real test is not another headline beat -- it is whether massive AI infrastructure spending is beginning to convert backlog into cash flow. The Setup Oracle Corporation
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Oracle reports earnings today: AI spending bet faces its toughest test yet By Investing.com
Investing.com -- Oracle is set to report fiscal first-quarter 2027 earnings after the market close on Thursday, in a print that will show whether the AI spending boom can outrun the company's own soaring costs. The cloud computing giant's backlog has swelled to $638 billion, up 363% from a year
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Oracle exceeded Wall Street expectations with 30% revenue growth reaching $19.35 billion in its fiscal first quarter. Cloud revenue surged 62% to $11.61 billion, powered by a 121% jump in cloud infrastructure revenue. The company secured over $30 billion in new AI cloud contracts while bringing 850 megawatts of data center capacity online.
Oracle Delivers Strong Fiscal First-Quarter Results
Oracle topped Wall Street expectations for its fiscal first-quarter results, reporting adjusted earnings per share of $1.92 on revenue of $19.35 billion, representing a 30% year-over-year increase
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. Both figures exceeded analyst estimates compiled by Visible Alpha, with revenue surpassing the expected $19.14 billion1
. Shares rose nearly 6% in extended trading following the earnings report, and gained an additional 3% in early Friday trading1
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. The company lifted its annual profit forecast to $8.10 per share for fiscal 2027, up from the prior forecast of $8.05, while expecting total revenue of at least $90 billion1
.Cloud Revenue and AI-Driven Growth Accelerate
Cloud revenue jumped 62% from a year earlier to $11.61 billion, driven by a remarkable 121% surge in cloud infrastructure revenue to $7.4 billion
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. Oracle brought 850 megawatts of additional data center capacity online during the quarter, demonstrating its aggressive expansion in cloud computing services1
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. The company secured more than $30 billion of new AI cloud contracts during the quarter without requiring additional capital expenditure from Oracle, as these deals involve prepayment structures or bring-your-own-hardware arrangements2
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. Oracle stated that "customer demand for AI Cloud Training and Inferencing Services continues to grow faster than supply," highlighting the robust AI-driven cloud demand the company is experiencing4
.Revenue Backlog Reaches Record Levels
Oracle's revenue backlog stood at $664 billion at the end of the fiscal first-quarter, up from $638 billion in the prior three months and exceeding analyst estimates of $639.89 billion
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. This represents a $26 billion jump in AI-fueled backlog growth that helped ease concerns around the company's debt-funded expansion5
. Roughly half of the $664 billion backlog is expected to convert into sales within the next 36 months, and much of the newly contracted revenue will not require Oracle's own capital as it relies on client prepayments and customers' chip supply to build out data center capacity5
.Analyst Reactions Highlight Growth Momentum
Wall Street analysts responded positively to Oracle's quarterly revenue performance, with Citi maintaining a Buy rating and $330 price target, noting "a favorable setup for upward revisions" given the magnitude of first-quarter outperformance
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. Bernstein maintained an Outperform rating with a $325 price target, stating this was "another strong quarter that increases clarity around the ORCL thesis" with revenue ramping, remaining performance obligations increasing, and strong margins2
. Deutsche Bank highlighted that Oracle completed its previously announced $20 billion ATM equity program during the quarter, removing what had been viewed as an overhang on shares2
. However, Morgan Stanley maintained an Equal weight rating, noting they need "more evidence on GPUaaS economics & visibility on infra build-out before becoming more constructive"2
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Cash Flow Concerns Persist Despite Strong Results
Despite the positive fiscal first-quarter results, concerns remain about Oracle's free cash flow and massive AI infrastructure investments. The company reported negative free cash flow of $5.40 billion, though this was better than analyst estimates of a cash burn of $9.56 billion
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. Morningstar analyst Luke Yang cautioned that "it will take years before revenue reaches a scale that supports continuous capacity expansion while generating positive cash flow at the same time"5
. Oracle has taken on more than $100 billion in debt to fund its data center expansion and plans to raise $40 billion through debt and equity financing in its current fiscal year, including the $20 billion stock sale completed in the first quarter2
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. In July, S&P Global downgraded Oracle's credit rating citing weak cash flow and rising business risk1
.Stock Performance and Market Positioning
Source: Benzinga
Oracle's stock has faced headwinds this year, falling more than 21% year-to-date through the last close and losing over half its value from 52-week highs, compared to an nearly 11% rise in the S&P 500 index
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. Investor optimism ahead of the earnings report was evident in options trading, where calls were trading at richer premiums compared to puts, reflecting expectations of potential upside3
. The stock trades at 16.86 times its forward earnings estimates, compared to Microsoft's 23.84 multiple and Amazon's 22.58, suggesting Oracle remains undervalued relative to cloud infrastructure peers5
. Evercore analysts noted the results were "a solid step forward in balancing the investor discussion around a company delivering accelerating revenue growth, at scale"5
. For the second quarter, Oracle expects a 30% to 34% jump in revenue and adjusted profit between $1.85 and $1.93 per share, both in line with market expectations1
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