Oracle Q4 EPS Tops Estimates but Shares Fall Over 10% on AI Spending
ORCL•Oracle reported fiscal Q4 adjusted EPS of $2.11 on $19.18 billion revenue, with cloud sales up 47% year-over-year to $9.9 billion and remaining performance obligations rising $85 billion to $638 billion. Shares plunged over 10% after management unveiled plans for $40 billion in AI infrastructure financing and flagged a sharp rise in AI-related capital spending.
1. Q4 financial results exceed expectations
Oracle delivered adjusted earnings of $2.11 per share on $19.18 billion revenue for the quarter ended May 31, surpassing analyst forecasts of $1.97 and $19.09 billion respectively. This marked a strong finish to fiscal 2026's final quarter, driven by robust demand across its software and cloud offerings.
2. Cloud growth and rising performance obligations
The company’s cloud segment grew 47% year-over-year to $9.9 billion, reflecting continued enterprise adoption of its infrastructure services. Remaining performance obligations climbed by $85 billion to $638 billion, largely fueled by large AI-related contracts that include prepaid GPUs and customer-supplied hardware.
3. AI financing and capital expenditure outlook
Oracle announced plans to raise approximately $40 billion through debt and equity to fund a significant increase in AI infrastructure spending. Management forecasted fiscal Q1 2027 revenue growth of 27% to 29% and adjusted EPS of $1.71 to $1.75, while maintaining its full-year revenue target of $90 billion.
