Oracle’s stock advanced in after-hours trading following the release of financial results for the fiscal first quarter ended Aug. 31. The company reported revenue growth of nearly 30% on a year-over-year basis, with net income of $4.68 billion, or $1.56 per share, compared to $2.93 billion, or $1.01 per share, in the prior-year period.
Cloud revenue demonstrated particularly strong performance, increasing 62% to $11.61 billion and surpassing analyst estimates of $11.51 billion. Cloud infrastructure revenue more than doubled to $7.4 billion, exceeding the consensus forecast of $7.09 billion. However, software revenue declined approximately 3% to $5.55 billion, falling short of analyst expectations of $5.61 billion.
Looking ahead, Oracle provided guidance for the fiscal second quarter calling for adjusted earnings per share between $1.85 and $1.93, with revenue growth projected between 30% and 34%. For the 2027 fiscal year, the company projects $8.10 in adjusted earnings per share on at least $90 billion in revenue.
The expansion reflects Oracle’s aggressive investment in data center infrastructure to compete in the artificial intelligence sector. Capital expenditures surged to $28.50 billion from $8.50 billion the prior year, and the company delivered 850 megawatts of data center capacity during the quarter. Management stated that more than $30 billion in additional AI contracts were secured without requiring additional capital from Oracle. Despite these achievements, the company carries $125 billion in debt and reported negative free cash flow of $5.4 billion compared to negative $362 million a year earlier. Remaining performance obligations stood at $664 billion, exceeding analyst expectations of $630.6 billion. Year-to-date, Oracle shares have declined 22% through Thursday’s close, while the S&P 500 has gained roughly 11%.
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