Oracle stock falls as AI funding plans overshadow earnings beat

Oracle has reported stronger fiscal fourth-quarter earnings and revenue than analysts expected.

The company also raised its full-year profit outlook, while keeping its fiscal 2027 revenue target unchanged. However, Oracle shares fell 5% in extended trading after the company detailed new financing plans for AI infrastructure.

Oracle beats earnings and revenue estimates

Oracle reported adjusted earnings of $2.11 per share for the fiscal fourth quarter. Analysts surveyed by LSEG expected adjusted earnings of $1.96 per share. Revenue reached $19.18 billion, compared with the $19.10 billion consensus estimate. The company said revenue increased 21% from the same quarter last year.

Net income rose to $4.22 billion, or $1.45 per share. A year earlier, Oracle posted net income of $3.43 billion, or $1.19 per share. Adjusted earnings excluded the effect of stock-based compensation, according to the company statement. Oracle also raised its fiscal 2027 adjusted earnings forecast to $8.05 per share.

Analysts expected $8.01 per share and $88.90 billion in revenue for fiscal 2027. Oracle kept its earlier fiscal 2027 revenue forecast at $90 billion. For the fiscal first quarter, Oracle projected adjusted earnings of $1.72 to $1.76 per share. It also forecast revenue growth of 27% to 29%.

AI financing plan weighs on shares

Oracle said it expects to raise $40 billion through debt and equity financing. The plan includes a $20 billion share sale that the company announced earlier. The latest financing plan follows large fundraising activity in fiscal 2026. Oracle raised $43 billion in debt and $5 billion in equity during that year.

Some shareholders have focused on the cost of Oracle’s AI infrastructure plans. The company reported negative free cash flow of $23.7 billion for the fiscal year. Oracle said large AI contracts drove most of its remaining performance obligation increase. Remaining performance obligation reached $638 billion on May 31, up 363%.

StreetAccount analysts expected remaining performance obligation of $595.67 billion. Oracle’s figure came well above that estimate. “Most of the RPO increase in both Q3 and Q4 were large scale AI contracts,” Oracle said. The company said some customers prepaid for GPUs or supplied them directly.

Cloud infrastructure growth remains strong

Oracle’s cloud revenue increased 47% in the quarter to $9.91 billion. Analysts polled by StreetAccount expected cloud revenue of $9.97 billion. Cloud infrastructure revenue jumped 93% to $5.8 billion. Amazon Web Services generated $37.59 billion in revenue during its March quarter.

Software revenue, including licenses and support, totaled $6.82 billion. That figure fell 2% from a year earlier and missed StreetAccount’s $6.93 billion estimate. Bank of America analysts said more than half of Oracle’s remaining performance obligation comes from OpenAI. The analysts maintain a buy rating on Oracle shares.

During the quarter, Oracle hired Hilary Maxson as chief financial officer. Maxson previously worked as an executive at Schneider Electric. Related Digital and Blackstone also secured funding for a $16 billion Oracle data center site in Michigan. Oracle shares had gained 3% in 2026 through Wednesday’s close, while the S&P 500 rose 6%.