Oracle's Q3 Earnings: AI Drives Growth Despite Missing Wall Street Expectations

Oracle Q3 Earnings Preview: 'Some Positive Signs And Good Risk/Reward' Ahead Of Print - Oracle (NYSE:ORCL)

The new Benzinga Rankings show you exactly how stocks stack up -- scoring them across five key factors that matter most to investors. Every day, one stock rises to the top. Which one is leading today? Software giant Oracle Corporation ORCL could highlight its AI progress when the company reports third-quarter financial results after market close Monday. Earnings Estimates: Analysts expect Oracle to report third-quarter revenue of $14.39 billion, up from $11.45 billion in last year's third quarter, according to data from Benzinga Pro. The company missed revenue estimates in the second quarter and has missed revenue estimates from analysts in seven of the last 10 quarters. Analysts expect the company to report earnings per share of $1.49, up from $1.41 in last year's third quarter. The company missed analyst estimates in the second quarter, while beating estimates in eight of the last 10 quarters overall. Read Also: How To Earn $500 A Month From Oracle Stock Ahead Of Q3 Earnings What Experts Are Saying: Oracle stock could be highly volatile after Monday's earnings report, Freedom Capital Markets chief global strategist Jay Woods said in a weekly newsletter. "Shares of the software giant have fallen over 20% from their December peak and are trading at their lowest levels since last September. They missed earnings last quarter and fell even further on the uncertainty around the competition from DeepSeek." Woods said the one-day implied move is +/- 9.2% for Oracle stock, a move that could impact several ETFs that count the stock as a top holding including the SPDR-Select Technology ETF XLK. Last week Oracle stock closed below its 200-day moving average for the first time since February of 2025. Woods questions if the stock can stay above this support area after earnings. "There are some positive signs and good risk/reward set-ups to watch as we head into Monday afternoon's earnings release." JPMorgan analyst Mark Murphy maintained a Neutral rating ahead of the earnings report. The analyst said Oracle could have a spike in remaining performance obligations. Murphy said Oracle's heavy debt load could be a concern and an area for investors to watch. Oracle should have several large AI-related deals in the quarter and could highlight its role in Project Stargate, Murphy added. Key Items to Watch: Along with AI revenue and deals, another key item to watch will be if Oracle comments on the TikTok sale process. Oracle is a partner with TikTok and could be involved in the future or move to the side, depending on which bidding group, if any, ends up acquiring the company. Oracle co-founder Larry Ellison has been mentioned by President Donald Trump as an interested party in TikTok, but Oracle has been relatively quiet about its intentions regarding an acquisition. Oracle's cloud revenue was $5.9 billion in the second quarter, up 24% year-over-year. The increase came from "record level AI demand." Ellison said Oracle will continue to see impressive growth thanks to artificial intelligence. "Oracle trained AI models and AI Agents will improve the rate of scientific discovery, economic development and corporate growth throughout the world. The scale of the opportunity is unimaginable," Ellison said. Analysts and investors will likely be hoping for the company to beat revenue and earnings per share estimates and provide a bullish look on the future outlook of the company. ORCL Price Action: Oracle stock is down 4.8% to $147.72 on Monday versus a 52-week trading range of $111.18 to $198.31. Oracle shares are down 11% year-to-date in 2025, while up 29% over the last year. Read Next: Oracle Boosts AI In Construction And Cloud With New Innovations At Customer Edge Summit Photo: Shutterstock ORCLOracle Corp$149.64-3.56%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum86.39Growth58.11Quality-Value14.54Price TrendShortMediumLongOverviewXLKSPDR Select Sector Fund - Technology$211.67-3.14%Market News and Data brought to you by Benzinga APIs

Oracle Q3 2025 Earnings: CEO Catz Calls AI A 'Motivator' For Cloud Adoption

'You're at a disadvantage if you do not use this,' Oracle CEO Safra Catz says. Oracle CEO Safra Catz called artificial intelligence a "motivator" for finally getting laggard organizations to adopt the cloud. "That is such a time saver and so much incredible productivity and insight that you're at a disadvantage if you do not use this," she said. "So much of the work that my teams do is enabled because of these advanced technologies, and it's your way to get there. Ultimately, everyone's going to come to it, and it should be motivating them, because it is such a massive not only productivity improvement-and as a result, lower cost-but it also gives you incredible insight into your business. It's really amazing." Catz's comments were among the highlights of the Austin, Texas-based database products giant's third fiscal quarter earnings call held Monday. The call covered the three months ended Feb. 28. Catz told analysts on the call that the vendor's recent partnerships with the three hyperscalers-Microsoft, Amazon Web Services and Google-has positioned Oracle to get revenue whether customers come in through a hyperscaler or through Oracle itself. During the quarter, Oracle's 101st cloud region came online, Catz said. The vendor expects its available power capacity will double this calendar year and triple by the end of its next fiscal year. Oracle has 40 cloud regions planned the hyperscalers. "It's just a matter of time before we have more cloud regions than all of our competitors combined," she said. "We are the destination of choice for both AI training and inferencing." Oracle Chief Technology Officer and co-founder Larry Ellison said that the quality of the vendor's AI agents have helped to separate it from the competition. He said that agents are so integral to this next AI wave that vendors won't have the ability to separate the money made on agents compared to the money made on applications. "We're selling more and more health care systems because we have a lot of the agents embedded in them, which helps doctors, which produces better outcomes for patients and saves governments and payers money," he said. "The applications themselves will migrate to be basically a bunch of connected AI agents. You're not going to be able to separate how much did you make on the AI agents and how much did you make on the rest of the application. All of our applications are becoming AI agents." Ellison said that AI inferencing "is a much bigger opportunity" for the vendor compared to AI training. Not many organizations will need to build frontier models, but hundreds of thousands of Oracle customers will consume AI models and train AI models on private data and run agents and applications on top. Ellison told analysts that Oracle is "building a gigantic 64,000 GPU, liquid-cooled Nvidia GB200 cluster for AI training" to meet increased demand, as well as a multibillion-dollar contract with Advanced Micro Devices (AMD) "to build a cluster of 30,000 of their latest MI355X GPUs." Oracle saw $14.1 billion in total revenue during the quarter, up 8 percent year over year ignoring foreign exchange. Cloud revenue accounted for $6.2 billion during the quarter, up 25 percent year over year. Infrastructure-as-a-service (IaaS) was $2.7 billion, up 51 percent. Software-as-a-service (SaaS) revenue was $3.6 billion, up 10 percent. The Fusion Cloud enterprise resource planning (ERP) offer brought in $900 million during the quarter, up 18 percent year over year. NetSuite Cloud ERP brought in the same amount, up 18 percent year over year. Cloud services and license support revenues grew 12 percent year over year to $11 billion, according to the vendor. Cloud license and on-premises license revenues fell 8 percent year over year ignoring foreign exchange to $1.1 billion. Cloud database services have an annualized revenue of $2.3 billion and grew 28 percent year over year. Autonomous Database consumption revenue grew 42 percent year over year. The vendor's remaining performance obligations (RPO) was $130 billion, up 63 percent year over year ignoring foreign exchange. That backlog should help increase Oracle's overall revenue in the next fiscal year by 15 percent, according to the vendor. The backlog also doesn't include any business from the $500 billion Stargate AI infrastructure venture planned by Oracle, OpenAI and Softbank. Oracle's multi-cloud database revenue from the hyperscalers grew 92 percent in the last three months. Graphics processing unit (GPU) training consumption for AI training more than tripled year over year. Oracle's capital expenditures (CapEx) for the 2025 fiscal year should be more than double year over year, around $16 billion, Catz said on the call. "We remain careful to pace and align our CapEx investments appropriately and in line with booking trends." Oracle's stock traded at about $154 a share after market close Monday, up about 5 percent. Catz forecasted that cloud infrastructure revenue for fiscal year 2025 will grow faster than the 50 percent reported last year. "It will be even faster for fiscal year 2026-likely a lot faster," she said. "Our confidence in meeting our $66 billion revenue target for FY26 is now stronger than ever and represents around a 15 percent growth rate." Catz took the fiscal year 2027 growth rate up to 20 percent during the call. In the fourth fiscal quarter, Catz said to expect total revenues to 9 percent to 11 percent ignoring foreign exchange. Total cloud revenue should grow 24 percent to 28 percent year over year.

Oracle Q3 sees strong growth but misses Wall Street expectations, despite everything "chugging on all fronts"

Oracle disappointed Wall Street with Q3 earnings that missed expectations despite hefty growth levels across the board and record levels of demand on its order book. Total revenue came in at $14.1 billion, up six percent year-on-year, with net income of $2.9 billion, up 22%. Total cloud revenue (IaaS plus SaaS) of $6.2 billion was up 23%, with infrastructure revenue $2.7 billion being up a massive 49%.Fusion Cloud ERP and NetSuite Cloud ERP each contributed $0.9 billion, both up 16% year-on-year. The company signed contracts for more than $48 billion during the quarter, according to CEO Safra Catz, with Remaining Performance Obligation (RPO) up 63% year-on-year to over $130 billion and that doesn't include any contracts related to the Stargate Trump-endorsed initiative announced during the quarter to build out US cloud infrastructure in association with OpenAI and Softbank. Growth in the AI segment of the infrastructure business was picked out for mention, with Catz dubbing it "extraordinary": GPU consumption revenue is now nearly 3.5 times the size of last year's. Cloud database services, which were up 28%, now have annualized revenue of $2.3 billion, Autonomous Database consumption revenue was up 42% on top of the 32% growth reported last year. For his part, CTO Larry Ellison pointed to the AI Data Platform as a particular success story the quarter: That enables our huge installed base of database customers to use the latest AI models from OpenAI xAI and meta to analyze all of the data they have stored in their millions of existing Oracle databases. By using Oracle version 23 AI's vector capabilities, customers can automatically put all of their existing data into the vector format that is understood by AI models. This allows those AI models to learn, understand and analyze every aspect of your company or government agency, instantly unlocking the value in your data while keeping your data private and secure. This AI inferencing will be another great large new business for Oracle. On the subject of Stargate mentioned above, Ellison explained a little more about Oracle's role in the project: The capability we have is to build these huge AI clusters with technology that actually runs faster and more economically than our competitors. So it really is a technology advantage we have over them. If you run faster and you pay by the hour, you cost less. So that technology advantage translates to an economic advantage, which allows us to win a lot of these huge deals...Stargate looks to be the biggest project -- AI training project out there. And we expect that will allow us to grow our RPO even higher in the coming quarters. And we do expect Stargate of our first large Stargate contract fairly soon. While waiting for that to happen, Ellison cited 200% growth over the past three months in Oracle's multi-cloud business with Amazon, Google and Microsoft: Now the customers can get our database everywhere. They can install an Oracle cloud region on their premises. They can get Oracle from Azure. They can get Oracle from Google. They can get Oracle from AWS. They obviously get a good Oracle from OCI. And that Oracle database is becoming more and more capable. It does store most of the world's valuable data. It is by far the largest database installed base in the world, with nothing remotely close. The reality is that everything is chugging on all fronts. Wall Street may have been disappointed by the missing of estimates in Q3, but the numbers are strong enough for Catz to raised expectations moving forward: Our confidence in meeting our $66 billion revenue target for FY '26 is now stronger revenue than ever and represents around a 15% growth rate. And more importantly, I now expect that our fiscal year '27 growth rate will be around 20%, which is even higher than I previously guided. She added:

Oracle's Sales Miss Estimates. Its CEO Expects AI-Driven Growth.

Oracle (ORCL) reported fiscal third-quarter sales that missed analysts' expectations, but executives said they expect AI-driven growth in the coming fiscal year. The tech giant saw quarterly revenue climb 6% year-over-year to $14.1 billion, slightly below the analyst consensus compiled by Visible Alpha. Adjusted earnings of $4.2 billion, or $1.47 per share, rose from $3.98 billion, or $1.41 per share, a year earlier, but missed estimates. The company also announced a 25% increase to its quarterly dividend, raising it to 50 cents per share from 40 cents. Oracle CEO Safra Catz said revenue is expected to grow 15% in the fiscal 2026, which begins in June, and highlighted cloud agreements with AI leaders including Nvida (NVDA), Meta (META), OpenAI, and xAI. The company is on pace to double data center capacity this calendar year, Chief Technology Officer Larry Ellison said, adding "customer demand is at record levels." Oracle is connecting AI models including OpenAI's ChatGPT, xAI's Grok, and Meta's Llama to the latest version of the Oracle Database, Ellison said. In January, Oracle, along with OpenAI and SoftBank, announced a joint venture known as Stargate to build artificial intelligence infrastructure in the U.S. The companies said they would commit $100 billion to start, and as much as $500 billion over the next four years. Shares of Oracle rose 3.5% in after-hours trading Monday following the release. They've added close to a third of their value of the past year through Monday's close.

Oracle Q3 Earnings: Revenue Miss, EPS Miss, Backlog Booms 62%, Strong AI Growth Expected, Shares Climb - Oracle (NYSE:ORCL)

Oracle Corp ORCL reported third-quarter financial results after the market close on Monday. Here's a look at the key metrics from the quarter. Q3 Earnings: Oracle reported third-quarter revenue of $14.13 billion, missing the consensus estimate of $14.39 billion, according to Benzinga Pro. The company reported third-quarter adjusted earnings of $1.47 per share, missing analyst estimates of $1.49 per share. Total revenue was up 6% year-over-year. Cloud revenue was up 23%, cloud infrastructure revenue was up 49%, cloud application revenue was up 9% and Fusion cloud revenue and NetSuite Cloud ERP revenue were both up 16% in the quarter. Remaining performance obligations totaled $130 billion at the quarter's end, up 62% year-over-year. Oracle ended the quarter with approximately $17.41 billion in cash and cash equivalents. "We have now signed cloud agreements with several world-leading technology companies including OpenAI, xAI, Meta, NVIDIA and AMD. We expect that our huge $130 billion sales backlog will help drive a 15% increase in Oracle's overall revenue in our next fiscal year beginning this June," said Safra Catz, CEO of Oracle. "And we expect RPO to continue to grow rapidly -- as we look forward to signing our first Stargate contract -- yet another big opportunity for Oracle to expand both its AI training and AI inferencing businesses in the near future." Check This Out: Nasdaq, S&P 500 Hit 6-Month Lows As Recession Fears Grow: What's Driving Markets Monday? Oracle's board declared a quarterly cash dividend of 50 cents per share, payable on April 23 to shareholders of record as of April 10. The new dividend represents a 25% increase over the current quarterly dividend of 40 cents per share. "We are on schedule to double our data center capacity this calendar year. Customer demand is at record levels. Our Database MultiCloud revenue from Microsoft, Google and Amazon is up 92% in the last three months alone. GPU consumption for AI training grew 244% in the last 12 months. And we are seeing enormous demand for AI inferencing on our customers' private data," said Larry Ellison, chairman and CTO or Oracle. Oracle typically provides forward guidance on its earnings call with investors, which is set to kick off at 5 p.m. ET. ORCL Price Action: Oracle shares were up 2.16% after hours, trading at $151.82 at the time of publication Monday, according to Benzinga Pro. Read Next: Larry Ellison Poured $500 Million Into High-Tech Farming -- And It's Struggling To Take Root Photo: Shutterstock. ORCLOracle Corp$149.97-3.34%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum86.39Growth58.11Quality-Value14.54Price TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs

Oracle misses on earnings but touts data center growth from AI

Larry Ellison, chairman and co-founder of Oracle Corp., speaks during the Oracle OpenWorld 2017 conference in San Francisco, California, U.S., on Sunday, Oct. 1, 2017. Oracle issued quarterly results on Monday that trailed analysts' estimates, but the company offered bullish comments on its cloud infrastructure segment. Here is how Oracle did compared to LSEG consensus: Revenue increased 6% from $13.3 billion in the same period last year. Net income rose 22% to $2.94 billion, or $1.02 a share, from $2.4 billion, or 85 cents a share, a year earlier. Revenue in Oracle's cloud services business jumped 10% from a year earlier to $11.01 billion, accounting for 78% of total sales. The company's cloud infrastructure segment, which helps businesses move workloads out of their own data centers, has been booming due to demand for computing power that can support artificial intelligence projects. Oracle said revenue in its cloud infrastructure unit increased 49% from a year earlier to $2.7 billion. "We are on schedule to double our data center capacity this calendar year," Oracle Chairman Larry Ellison said in a release. "Customer demand is at record levels." In January, President Donald Trump announced plans to invest billions of dollars in AI infrastructure in the U.S. in collaboration with Oracle, OpenAI and SoftBank. The first initiative of the joint venture, called Stargate, will be to construct data centers in Texas -- an effort that is already underway, Ellison said during the announcement at the White House. Oracle's cloud and on-premises licenses business contributed $1.1 billion in revenue during the quarter, down 10% year over year. Oracle also said it's increasing its quarterly dividend to 50 cents a share from 40 cents. As of Monday's close, the stock is down almost 11% year to date. Oracle will hold its quarterly call with investors where it will share its outlook at 5 p.m. ET.

Oracle Announces Fiscal 2025 Third Quarter Financial Results By Investing.com

AUSTIN, Texas, March 10, 2025 /PRNewswire/ -- Oracle Corporation (NYSE: ORCL) today announced fiscal 2025 Q3 results. Total Remaining Performance Obligations were up 62% year-over-year in USD, and up 63% in constant currency, to $130 billion. Total quarterly revenues were up 6% year-over-year in USD, and up 8% in constant currency, to $14.1 billion. Cloud services and license support revenues were up 10% year-over-year in USD, and up 12% in constant currency, to $11.0 billion. Cloud license and on-premise license revenues were down 10% in USD and down 8% in constant currency, to $1.1 billion. Q3 GAAP operating income was $4.4 billion. Non-GAAP operating income was $6.2 billion, up 7% in USD, and up 9% in constant currency. GAAP operating margin was 31%, and non-GAAP operating margin was 44%. GAAP net income was $2.9 billion, up 22% in USD, and up 27% in constant currency. Non-GAAP net income was $4.2 billion, up 6% in USD, and up 9% in constant currency. Q3 GAAP earnings per share was $1.02, up 20% in USD and up 25% in constant currency, while non-GAAP earnings per share was $1.47, up 4% in USD, and up 7% in constant currency. Short-term deferred revenues were $9.0 billion. Over the last twelve months, operating cash flow was $20.7 billion and free cash flow was $5.8 billion. "Oracle signed sales contracts for more than $48 billion in Q3," said Oracle CEO, Safra Catz. "This record sales number pushed our Remaining Performance Obligations, or RPO, up 63% to over $130 billion. We have now signed cloud agreements with several world leading technology companies including: OpenAI, xAI, Meta, NVIDIA and AMD. We expect that our huge $130 billion sales backlog will help drive a 15% increase in Oracle's overall revenue in our next fiscal year beginning this June. And we expect RPO to continue to grow rapidly"as we look forward to signing our first Stargate contract"yet another big opportunity for Oracle to expand both its AI training and AI inferencing businesses in the near future." "We are on schedule to double our data center capacity this calendar year," said Oracle Chairman and CTO, Larry Ellison. "Customer demand is at record levels. Our Database MultiCloud revenue from Microsoft, Google and Amazon is up 92% in the last three months alone. GPU consumption for AI training grew 244% in the last 12 months. And we are seeing enormous demand for AI inferencing on our customers' private data. So, we are connecting OpenAI ChatGPT, xAI Grok and Meta Llama directly to Version 23ai of the Oracle Database with advanced vector capabilities. This new product, called the Oracle AI Data Platform, makes it easy for customers to use any of the world's leading AI models to analyze all of their private data"while keeping all their data private and secure." Oracle also announced that its Board of Directors declared a quarterly cash dividend of $0.50 per share of outstanding common stock, reflecting a 25% increase over the current quarterly dividend of $0.40. Larry Ellison, Oracle's Chairman of the Board of Directors, Chief Technology Officer, and largest stockholder, did not participate in the deliberation or the vote on this matter. This increased dividend will be paid to stockholders of record as of the close of business on April 10, 2025, with a payment date of April 23, 2025. Earnings Conference Call and Webcast Oracle will hold a conference call and webcast today to discuss these results at 4:00 p.m. Central. A live and replay webcast will be available on the Oracle Investor Relations website at www.oracle.com/investor/. About Oracle Oracle offers integrated suites of applications plus secure, autonomous infrastructure in the Oracle Cloud. For more information about Oracle (NYSE: ORCL), please visit us at www.oracle.com. Trademarks Oracle, Java, MySQL, and NetSuite are registered trademarks of Oracle Corporation. NetSuite was the first cloud company"ushering in the new era of cloud computing. "Safe Harbor" Statement: Statements in this press release relating to future plans, expectations, beliefs, intentions and prospects, including the expectations for converting RPOs to revenue, future growth in RPO and data center capacity, the timing of signing the Stargate contract, and future demand for AI inferencing are "forward-looking statements" and are subject to material risks and uncertainties. Risks and uncertainties that could affect our current expectations and our actual results, include, among others: our ability to develop new products and services, integrate acquired products and services and enhance our existing products and services, including our AI products; our management of complex cloud and hardware offerings, including the sourcing of technologies and technology components; our ability to secure data center capacity; significant coding, manufacturing or configuration errors in our offerings; risks associated with acquisitions; economic, political and market conditions; information technology system failures, privacy and data security concerns; cybersecurity breaches; unfavorable legal proceedings, government investigations, and complex and changing laws and regulations. A detailed discussion of these factors and other risks that affect our business is contained in our SEC filings, including our most recent reports on Form 10-K and Form 10-Q, particularly under the heading "Risk Factors." Copies of these filings are available online from the SEC or by contacting Oracle's Investor Relations Department at (650) 506-4073 or by clicking on SEC Filings on the Oracle Investor Relations website at www.oracle.com/investor/. All information set forth in this press release is current as of March 10, 2025. Oracle undertakes no duty to update any statement in light of new information or future events. To supplement our financial results presented on a GAAP basis, we use the non-GAAP measures indicated in the tables, which exclude certain business combination accounting entries and expenses related to acquisitions, as well as other significant expenses including stock-based compensation, that we believe are helpful in understanding our past financial performance and our future results. Our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Compensation of our executives is based in part on the performance of our business based on these non-GAAP measures. Our non-GAAP financial measures reflect adjustments based on the following items, as well as the related income tax effects:

Oracle's Q3 Falls Short, But AI Demand Keep Long-Term Outlook Strong Say Analysts - Oracle (NYSE:ORCL)

Oracle Corp ORCL shares are down on Tuesday, after the company reported downbeat fiscal third-quarter results. The results came in amid an exciting earnings season. Here are some key analyst takeaways. Cantor Fitzgerald On Oracle Analyst Thomas Blakey maintained an Overweight rating while reducing the price target from $214 to $175. Oracle reported its fiscal third-quarter revenues slightly short of expectations, while adjusted earnings were in-line and free cash slowed significantly below estimates, Blakey said in a note. The revenue-line miss was "driven by SaaS, with OCI essentially in-line," he added. The company's bookings in the quarter were substantially better than expected and were driven by "a handful of large deals and zero Stargate," the analyst stated. "Stronger bookings lead to higher F26/F27 top-line guidance as Oracle is accelerating its OCI business benefiting from AI," he further wrote. BMO Capital Markets On Oracle Analyst Keith Bachman reiterated a Market Perform rating, while cutting the price target from $205 to $175. Oracle reported revenue misses "in many areas," including cloud revenues, Bachman said. While AI demand continues to outweigh supply, they should be in "better balance" from the first quarter of fiscal 2026, he added. Oracle's total RPOs (remaining performance obligation) in constant currency terms grew by 63% year-on-year in the fiscal third quarter to $130 billion, accelerating from 50% in the previous quarter, the analyst stated. This RPO does not include any benefit from Stargate, with the first large contract possibly "coming soon," he further wrote. Stifel On Oracle Analyst Brad Reback reaffirmed a Hold rating while trimming the price target from $175 to $150. Oracle reported revenue growth of 8%, missing its guidance range of 9%-11%, Reback said. Its RPOs grew driven by demand for Cloud Services, he added. Importantly, management highlighted that RPO growth did not include any contribution Despite the revenue miss, management guided to around 15% revenue growth in fiscal 2026, due to strong RPOs, the analyst stated. "We believe continued solid revenue growth is sustainable as AI infrastructure bookings strength converts into training revenue and hyperscaler database partnerships scale medium-term," he further wrote. Goldman Sachs On Oracle Analyst Kash Rangan maintained a Neutral rating while reducing the price target from $185 to $165. While Oracle's revenues missed consensus by 1.8%, gross profit came in 2% lower and free cash flows missed expectations by 96%, Rangan said. The revenue miss was partly due to "near-term supply constraints (for AI training infrastructure) which capped the growth trajectory of the IaaS business," he added. Management guided revenue growth of 15% for fiscal 2026 and 20% for fiscal 2027, higher than consensus of 12.5% and 14%, respectively, the analyst stated. Another positive was expectations for new bookings from the Stargate JV "in coming months," he further wrote. Check out other analyst stock ratings. Piper Sandler On Oracle Analyst Brent Bracelin reiterated an Overweight rating while cutting the price target from $210 to $190. Oracle reported a record increase in RPO backlog, up $33 billion sequentially and more than 60% year-on-year, Bracelin said. This suggests "no signs of slowing demand for AI infrastructure," he added. With demand outweighing supply, the company increased its capital expenditure plan for the year to $16 billion, from $14 billion previously, the analyst stated. "Stargate has promising potential to further elevate RPO exiting F2025," he further wrote. Citizens On Oracle Analyst Patrick Walravens reaffirmed a Market Outperform rating and price target of $205. Oracle reported its non-GAAP earnings at $1.47 per share, missing consensus of $1.49 per share, and operating margins of 43.8%, below expectations of 43.4%, Walravens said. Due to this, revenues of $14.13 billion missed consensus of $14.39 billion, he added. Despite these, the company posted "its strongest bookings quarter ever," the analyst wrote. RPOs rose to $130 billion, up around $33 billion in absolute dollars compared to the previous record of $18 billion in the fiscal fourth quarter of the previous year, he further stated. KeyBanc Capital Markets On Oracle Analyst Jackson Ader maintained an Overweight rating and price target of $200. A few months back, Oracle had indicated that Meta Platforms Inc META would become an RPO contributor in the fiscal third quarter, Ader said. Since then, the company has "proceeded to find more really solid deals throughout the quarter," he added. Although volatility could grow, management expressed confidence in the company's backlog continuing to build, the analyst stated. "Despite another essentially in-line IaaS period, management reiterated confidence in OCI growth accelerating for the fiscal year while setting the stage for even more acceleration in FY26," he further wrote. DA Davidson On Oracle Analyst Gil Luria reiterated a Neutral rating and price target of $150. Oracle reported mixed quarterly results, with slowing revenue growth excluding OCI, Luria said. Despite the miss, management remained positive about next year and guided to 15% revenue growth "due to the doubling of data center capacity, along with Stargate contracts beginning to come into the fold," he added. Oracle Cloud Infrastructure (OCI) remains the driver of acceleration in the company's growth to high-single-digit levels, the analyst stated. "Management noted that they're seeing strong backlog and growth of their remaining performance obligations, calling out significant customers of theirs including OpenAI, xAI, and Meta," he further wrote. ORCL Price Action: Shares of Oracle had declined by 3.37% to $143.92 at the time of publication on Tuesday. Read More: * Warren Buffett Rakes In $607 Million While Elon Musk, Jeff Bezos, And Other Top Moneybags Bleed $67 Billion In A Day Amid Market Wipeout Photo: Shutterstock ORCLOracle Corp$143.73-3.40%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum85.05Growth58.16Quality-Value14.61Price TrendShortMediumLongOverviewMETAMeta Platforms Inc$603.550.93%Market News and Data brought to you by Benzinga APIs

Oracle misses expectations and guidance was also weak, sending its stock lower

Oracle misses expectations and guidance was also weak, sending its stock lower Shares of the database giant Oracle Corp. were heading lower in extended trading today after it missed analysts' expectations for its latest financial results. The company did reiterate its bullish stance on artificial intelligence and the prospects for its cloud infrastructure segment, but that wasn't enough to convince investors in another down day for the broader markets. Oracle reported fiscal 2025 third-quarter earnings before certain costs such as stock compensation of $1.47 per share, trailing the $1.49 per share forecast. Revenue for the period also came up short, with the company generating $14.13 billion in sales, up 6% from a year earlier but below the analyst target of $14.39 billion. Net income jumped 22% to $2.94 billion, or 85 cents per share after being adjusted for costs. The company's all-important cloud services and license support business grew the fastest, with revenue there rising 10% from the same period one year earlier to $11.01 billion, accounting for 78% of its total sales. However, that also came in below estimates, with the Street looking for sales of $11.21 billion. Oracle's cloud infrastructure segment has been booming in recent quarters, giving companies another alternative to shift enterprise workloads from their on-premises data centers. Customers have been rushing to the cloud primarily to support their generative AI projects, with Oracle offering access to thousands of graphics processing units from Nvidia Corp. The segment continued to grow at a rapid pace, with revenue there up 49% from a year ago to $2.7 billion. In a statement, Oracle Chairman Larry Ellison told analysts that the company is seeing record levels of customer demand in cloud infrastructure. "We are on schedule to double our data center capacity this calendar year," he added, saying this is necessary to meet that demand. According to Ellison, customers are especially interested in the company's new Oracle AI Data Platform, which allows them to use leading AI models such as OpenAI's GPT family, xAI Corp.'s Grok and Meta Platforms Inc.'s Llama family on their own data in a secure way. Oracle's other major business unit, cloud and on-premises, added $1.1 billion in revenue, down 10% from a year earlier. The company's remaining performance obligations, which refers to contracted revenue not yet recognized, jumped 62% during the quarter to $130 billion, outpacing the Street's estimate of $103.3 billion. Oracle Chief Executive Safra Catz (pictured) said the RPO bodes extremely well for the future, and she said she expects it to "continue to grow rapidly, as we look forward to signing our first Stargate contract". The Stargate Project was announced by Oracle and partners including OpenAI and SoftBank Group Corp. alongside U.S. President Donald Trump in January, and pledged to invest as much as $500 billion into AI infrastructure in the country over the next four years. According to Catz, Oracle's investments in Stargate and its own initiatives mean that its capital expenditures in fiscal 2025 will be "a little more than double" what the company spent in the last year, at around $16 billion. That's different from three months ago, when Catz said capex was likely to be "double" the previous year. "We remain careful to pace and align our capex investments appropriately and in line with booking trends," she told analysts. Analyst Rebecca Wettemann of Valoir told SiliconANGLE that investors are still nervous about cloud infrastructure providers overspending and overbuilding to support future AI workloads. They're nervous that these workloads either won't materialize, or will be less cost-effective than expected due to the rise of lower-cost AI models like DeepSeek Ltd.'s R1. "It's hard to plan a year ahead for data center capacity when AI and the supporting infrastructure are evolving so rapidly, especially if we're talking about global businesses that need to rethink their overall strategies because of changes in tariffs and supply chain exposure," Wettemann said. On the plus side, Catz announced that the company signed major cloud agreements with the likes of OpenAI, Nvidia and Meta during the quarter, which should help boost its overall revenue by 15% in the next fiscal year. As for guidance, Oracle said it's expecting revenue growth of between 8% and 9% in the current quarter, trailing Wall Street's forecast of $15.91 billion, which would represent around 11% growth. The company is also targeting earnings of between $1.61 to $1.65 per share, well below the Street's target of $1.79 per share. Investors were less than impressed with what they saw, and Oracle's stock dipped 4% in extended trading. That came after it fell 4% during the regular trading session. Investors have been behaving much more cautiously lately, selling previously strong-performing technology stocks amid ongoing economic uncertainty. They have major concerns about Trump's trade policies, and what tariffs could mean for many tech firms. "Oracle had three things going against it today," Wettemann said. "There's general skepticism about AI valuations, general economic uncertainty and market skittishness, and the lower-than-expected revenue number." That said, Wettemann pointed out that Oracle isn't as vulnerable as its cloud rivals are to the AI and cost pressures because it runs its own infrastructure and models and embeds these directly into its core applications, instead of selling it as a pricey add-on. "This keeps Oracle insulated from rising compute costs and lowers adoption barriers for customers already using its software," she said.

Oracle hasn't yet signed a Stargate contract

Guessed tax obligations wrong which helped to disappoint Wall Street even as sales boomed Oracle on Monday announced customers committed to $48 billion of future cloud services consumption - just $5 billion less that its annual revenue for FY 2024 - but investors aren't impressed. Big Red's revenue for Q3 2025 came in at $14.1 billion, up six percent year over year. Net income of $2.9 billion represented a 22 percent bump. Earnings per share (EPS) rose 20 percent to reach $1.02 - but Wall Street expected a couple of cents more and also hoped for higher revenue and profit. On the company's earnings call, CEO Safra Catz explained poor forecasting may have cost Oracle a shot at an EPS beat. "The non-GAAP tax rate for the quarter was 19.9 percent, which was higher than my 19 percent guidance and lowered EPS by $0.02," she admitted. "EPS currency headwind ended up at $0.04, more than I thought would be hurt by currency as currency continued to strengthen," she added. There's some irony in those admissions because Catz proudly pointed out that Oracle's use of its own Fusion ERP means it was able to report earnings just ten days into its new quarter. "We continue to file our quarterly and annual financial statements faster than any other company in the S&P 500," she said. Those statements just reflect the result of incorrect forecasts. Oracle shares started the day at $150.34 and after its earnings announcement briefly spiked to $153, sank to $141.74, before settling at around $144. The company predicted lovely numbers in the future as that $48 billion in cloudy bookings means it now has $130 billion of remaining performance obligation (RPO) on its books - that's stuff customers have committed to pay for, but which Oracle hasn't yet delivered. "The RPO figure is the leading indicator of demand for our cloud services, while our live data center count and power capacity is the leading indicator of the conversion of RPO to revenue," Catz said. The CEO told investors the quarter past saw Oracle's 101st cloud region come online and shared the expectation that Oracle's available power capacity will double this calendar year and triple by the end of its next fiscal year - meaning mid-2027. "As we bring more capacity online, our revenues will clearly accelerate," she said. Some of that revenue will come from the Stargate Project, the OpenAI-led $500 billion project to build giant AI datacenters that Oracle has already started building datacenters to host but which is yet to produce any revenue or bookings. Oracle's chair and CTO Larry Ellison let on that Big Red is yet to sign a contract to participate in the project. "We do expect ... our first large Stargate contract fairly soon," he said, despite previously saying work on datacenters for the project has already commenced. Whenever the deal is done, it will further boost RPO. Ellison talked up Oracle's datacenter architecture, praising its "high degree of automation, which lowers our labor costs dramatically." "More important than lowering our labor costs with no labor, there's no human error.," he said. "There's no human mischief. So, we're much more reliable and much more secure because we don't have a lot of human beings in our data centers." One interesting number in the quarterly results was 49 percent year on year growth in infrastructure-as-a-service (IaaS) revenue, making it Oracle's fastest-growing segment. NetSuite and cloudy ERP each grew 16 percent, and other SaaS grew nine percent. Ellison described Oracle's AI training and multi-cloud database as experiencing "hyper-growth", with Oracle's offerings hosted at AWS, Google and Microsoft growing 200 percent in the last three months. He also revealed Oracle is building "a gigantic 64,000 GPU liquid-cooled NVIDIA GB200 cluster for AI training." The cost of that rig is almost certainly included in the $16 billion annual capex expenditure forecast by Catz, $5.9 billion of which came in Q3. The CEO wrapped things by stating "Our confidence in meeting our $66 billion revenue target for FY '26 is now stronger than ever and represents around a 15 percent growth rate. And more importantly, I now expect that our fiscal year '27 growth rate will be around 20 percent, which is even higher than I previously guided."

Oracle stock gives investors whiplash as Larry Ellison touts AI 'hypergrowth' but earnings fall short

Investors weren't sure what to make of Oracle's (ORCL-3.75%) fiscal third-quarter earnings expectations late Monday, which fell short of analysts' expectations. Shares of Oracle climbed 5% in after-hours trading before sinking 3% as investors digested the missed targets. The stock was still off slightly in pre-market trading Tuesday. While investors focused on the earnings whiff, company leaders focused on what Oracle CTO Larry Ellison called "hypergrowth" in its cloud and AI projects. Both are experiencing double-digit growth, and analysts and executives expect that to continue. In the fiscal third quarter, Oracle reported total revenue of $14.13 billion, up 6% year over year, but short of analysts' consensus estimates of $14.38 billion. On an adjusted basis, the company earned $1.47 per share, compared with expectations of $1.49 per share. Oracle CEO Safra Catz touted a growth outlook for fiscal 2026 and 2027, pointing to continued demand for the company's advanced artificial intelligence computing. " As we bring more capacity online, our revenues will clearly accelerate," Catz said, referring to the data centers that Oracle continues to build. "We are on schedule to double our data center capacity this calendar year," Ellison said, adding that customer demand is at record levels. Much of the company's growth will come from growth in its AI and cloud services. Catz highlighted the company's record order backlog of $130 billion, which doesn't include the additional revenues generated from its participation in the so-called Stargate project. Stargate, touted by President Donald Trump as a $500 billion AI infrastructure investment right after he took office, includes tech titans such as Meta (META-4.21%) and ChatGPT maker OpenAI. Progress is already underway on the project's first data centers being constructed in Texas. "Each building is a half-a-million square feet," Ellison said. "There are 10 buildings currently being built, but that will expand to 20 and other locations beyond the Abilene location, which is our first location."