Oracle (ORCL) Stock Surges After Q3 Earnings Beat Wipes Out Months of Doubt

TLDR

• Oracle (ORCL) stock rose over 9% on Wednesday after beating Q3 earnings expectations
• Revenue jumped 22% year-over-year to $17.2 billion; Cloud Infrastructure revenue surged 84%
• Non-GAAP operating income grew 19% to $7.4 billion
• Oracle plans to raise $45–$50 billion in gross cash proceeds during 2026 to fund compute build-out
• The company is adding $500 million in restructuring costs, bringing the total to $2.1 billion this fiscal year, as AI allows it to cut software jobs

Oracle stock had a rough six months heading into Wednesday. Down roughly 44%, investors were dealing with concerns about AI capex spending, margin pressure, and a big reliance on OpenAI — a company that has yet to turn a profit. Then Q3 earnings landed, and the mood shifted fast.

Oracle Corporation, ORCL

The company posted revenue of $17.2 billion for its fiscal 2026 third quarter, up 22% year-over-year. That beat expectations and gave investors something to cheer about.

Cloud Infrastructure was the standout. That segment saw revenue surge 84%, showing Oracle is gaining real ground in the cloud race. Non-GAAP operating income came in at $7.4 billion, up 19%.

Management guided for revenue growth of 19% to 21% in the current quarter, with adjusted earnings-per-share growth of 15% to 17%.

Looking further ahead, Oracle is targeting revenue growth from $67 billion in fiscal 2026 to $90 billion in fiscal 2027.

Raising Capital to Build Out Compute

To fund the infrastructure needed to hit those targets, Oracle announced in early February its intention to raise between $45 billion and $50 billion in gross cash proceeds in 2026.

That’s a lot of debt to carry, and it was part of what had been weighing on the stock. But after Wednesday’s results, investors appear more willing to give management the benefit of the doubt.

ORCL holds a Strong Buy consensus rating on Wall Street, with 28 Buy ratings and 4 Hold ratings. The 12-month average price target sits at $256.23, implying upside of close to 60% from current levels.

AI Is Reshaping Oracle’s Workforce

Alongside the earnings beat came a less headline-friendly story: Oracle is accelerating job cuts across its software teams, and AI is the reason.

The company filed an SEC report Wednesday disclosing an additional $500 million in restructuring costs for the current fiscal year. That brings the total restructuring bill to $2.1 billion for the year ending May 31.

That’s up from the $1.6 billion Oracle flagged in its December quarterly filing — a 31% jump in projected costs. Restructuring spend had already risen 337% year-over-year in the nine months ended February 28.

Oracle said AI code-generation models have become efficient enough to allow the company to rebuild its product development teams into “smaller, more agile and productive groups.”

The company has not disclosed how many roles are being cut.

Oracle stock edged down 0.5% in premarket trading on Thursday following the disclosures.

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