Alexa play , Started from the bottom, now we're here!
Larry Ellison briefly topped the list of the world’s richest people , not because he built a rocket or unveiled the next big gadget, but because Oracle, his 48 year old software company, started behaving a lot like NVIDIA!
The stock jumped 36% after Oracle issued a killer forecast. Its cloud infrastructure business is expected to grow 14 fold over the next five years, making it the center of the company’s future.
Here’s a quick look at what changed and why Wall Street is paying attention:
Today’s lineup:
Oracle Q1 FY26 highlights
What’s behind the OCI pump
Key quotes from the earnings call
What to watch next & Wen lambo !
1. Oracle Q1 FY26 Highlights
The $455 billion RPO surprise
RPO , future revenue from signed contracts , is a key sign of upcoming cloud growth. It rocketed 359% year over year (up from 63% the previous quarter). Converting RPO into actual revenue depends mainly on how many data centers are online and their available power.
Project Stargate enters the picture
For the first time, Oracle added Project Stargate to its RPO. This multibillion dollar AI infrastructure plan aims to build some of the largest data centers ever, potentially reaching $500 billion in scale over four years. Partners include SoftBank, OpenAI, NVIDIA, MGX, and Oracle itself.
Cloud revenue keeps climbing
Oracle’s overall cloud revenue rose 28% year over year to $7.2 billion:
Cloud Infrastructure (IaaS): Compute, storage, and networking grew 55% year over year to $3.3 billion, up from 49% in Q4. High-performance workloads and multi-cloud setups are driving this surge. This segment is where most of the RPO is expected to turn into revenue.
Cloud Applications (SaaS): Oracle’s enterprise apps , ERP, HCM, CRM , grew 11% year over year to $3.8 billion as companies continue shifting to cloud based systems.
The takeaway is clear: most of Oracle’s legacy revenue has leveled off. The real growth story now lies in OCI.
Income Statement
Revenue grew 12% year over year to $14.9 billion, coming in $260 million short of expectations:
Cloud: up 28% to $7.2 billion
Software: down 1% to $5.7 billion
Hardware: up 2% to $0.7 billion
Services: up 7% to $1.3 billion
Gross margin slipped to 67% (down 3 points year over year) and operating margin eased to 29% (down 1 point). Non GAAP EPS landed at $1.47, a penny shy of estimates.
Cash Flow
Operating cash flow over the trailing twelve months hit $21.5 billion, up 13% year over year. Free cash flow swung to an outflow of $5.9 billion as capital spending soared to $27.4 billion from $7.8 billion a year ago.
Balance Sheet
Cash and short-term investments: $11.0 billion
Debt: $91.3 billion
Making Sense of It
Backlog spike: Remaining performance obligations surged on four multi-billion-dollar contracts across three customers. Converting that backlog into revenue depends on how quickly Oracle can add data center capacity and power.
Cloud is the engine: OCI still makes up only about 22% of total revenue today, but growth is projected to accelerate to 77% year over year in FY26 (up from 70%) to reach $18 billion.
Multicloud momentum: Revenue from hyperscaler partnerships jumped 1,529%, with dozens more regions planned. Oracle’s database and OCI are riding on the existing footprints of AWS, Azure, and Google Cloud.
Execution challenge: Contracts are signed, but Oracle now needs to build out the infrastructure. CapEx guidance for FY26 rose to $35 billion from $25 billion. Power and construction speed are the main bottlenecks.
Customer concentration: A handful of massive customers , including the Stargate/OpenAI program , likely account for most of the backlog surge. Any delay in these projects could slow conversion to revenue.
Debt load: Unlike most of Big Tech, Oracle carries heavy leverage, with net debt over $80 billion. It also paid more than $5 billion in dividends last year despite negative free cash flow, leaving less financial flexibility if the market turns.
OCI outlook expands: The company now projects OCI revenue to climb to $18 billion in FY26, then to $32 billion, $73 billion, $114 billion, and $144 billion over the next four years — a 14× increase from FY25 to FY30.
2. The OCI pump Explained
Before getting carried away by the $455 billion backlog, it’s worth remembering: RPO isn’t cash.
What it is ? Contracted, non cancelable future revenue not yet recognized.
Total vs. current: Current RPO converts within a year; total RPO stretches across multiple years. The headline figure tells you little about near-term revenue.
Why it can mislead ? A few large multi-year deals can make RPO balloon overnight, but revenue only shows up as capacity is built and customers start using it.
One offs vs. run rate: Don’t annualize one big quarter. Heavy concentration in a few contracts especially Project Stargate means the pump isn’t steady or predictable.
Long stroy short, OCI revenue, utilization, and CapEx progress are better guides to future growth than RPO alone.
Project Stargate’s Role
The Wall Street Journal reports that OpenAI signed a roughly $300 billion compute purchase agreement with Oracle starting in 2027. Oracle’s RPO jumped $317 billion sequentially. If the enforceable portion of that agreement was booked at signing , as Oracle says it does , Stargate likely explains most of the spike and underpins the new OCI forecast.
Q1 FY26 Context
Management laid out a multi year OCI ramp to $144 billion within five years , growth on the scale of NVIDIA’s data center business.
At last year’s Financial Analyst Meeting, Oracle set a FY29 revenue target of $104 billion for the entire company. Based on the new OCI forecast, that figure is now likely above $160 billion, even if other segments stay roughly flat. Management hadn’t previously shared an OCI-specific revenue target, so the detail and scale of this plan are significant.
Who Are the Other Customers?
Oracle hasn’t confirmed names, but the likely list for these multi-billion-dollar deals is short and high profile:
OpenAI (Project Stargate): Publicly announced a 4.5 gigawatt US expansion with Oracle. Media reports suggest a mega-contract supporting this capacity.
xAI: Oracle and xAI introduced Grok models on OCI for training and inference in June, matching the timing and scale of a multi-billion-dollar commitment.
Meta: With a planned AI CapEx of $66–$72 billion in 2025 and additional spending in 2026, Meta’s profile aligns with a multi-year OCI commitment.
Oracle also plans to offer Gemini models via OCI alongside Database Google Cloud and expand multicloud data centers for AWS, Azure, and Google.
3. Key Quotes from the Earnings Call
CEO Safra Catz , AI demand and customer base:
“Oracle has become the go to place for AI workloads. We have signed significant cloud contracts with the who's who of AI, including OpenAI, xAI, Meta, NVIDIA, AMD and many others.”
The surge in demand is concentrated, which explains the backlog spike. Delivery and timing for a few mega customers will largely determine revenue conversion.
On multicloud database momentum:
“Multi cloud database revenue grew 1,529% in Q1..34 multi-cloud data centers now live and we will deliver another 37 for a total of 71”
Embedding Oracle inside AWS, Azure, and Google Cloud broadens reach and speeds enterprise migrations.
On the CapEx model:
“We do not own the property ,What we do own , is the equipment ,we put in that equipment only when it's time [and are] already generating revenue right away, I don't want to call it asset-light but it's asset pretty light.”
This approach allows for faster CapEx to revenue conversion and strong financial flexibility.
Chairman and CTO Larry Ellison – AI focus and efficiency:
On inferencing vs. training:
“The AI inferencing market will be much, much larger than the AI training market.”
On cost and performance:
“Our networks move data very, very fast if we're twice as fast, we're half the cost.”
On AI database & vectorization:
“With the introduction of our new AI database .. you can vectorize [all your data] and.. directly connect .. to ChatGPT, Gemini, Grok, Llama.. uniquely available in the Oracle Cloud.”
On ‘Butterfly’ private cloud:
“We have gotten the entire Oracle Cloud, the whole thing, every feature, ..into.. 3 racks, we call it Butterfly. That costs $6 million.”
These statements highlight Oracle’s competitive edge: fast, cost-efficient infrastructure, deep integration with AI models, and a scalable private cloud option for regulated workloads.
4. What to Watch Moving Forward
The headlines are exciting, but the key focus should be on execution and conversion.
Cash vs. CapEx: Oracle is front-loading spending and running negative free cash flow near term. Watch for free cash flow to improve as new data centers come online and start billing. Heavy leverage and steady dividends leave less flexibility than peers.
Hitting the targets: The five year OCI ramp is now the scoreboard. Utilization of new regions is critical for revenue to match forecasts. Management expects more deals, but execution will drive results.
Cycle duration: Execution depends on power availability, GPUs, and rollout cadence for AWS, Azure, and Google regions. A slowdown in enterprise AI demand could delay conversion, though the relatively “asset-light” model mitigates risk.
Mega customer risk: A few massive customers , Stargate/OpenAI, xAI, and others , carry outsized weight. Any delays in milestones, power, or contract terms could push back revenue recognition.
SO Like NVIDIA, Oracle is now deeply embedded in Big Tech’s AI build out. It’s a CapEx beneficiary rather than a discretionary vendor. As long as the AI expansion continues, OCI has a clear path for exceptional growth.
Larry Ellison briefly topped the list of the world’s richest people , not because he built a rocket or unveiled the next big gadget, but because Oracle, his 48 year old software company, started behaving a lot like NVIDIA!
The stock jumped 36% after Oracle issued a killer forecast. Its cloud infrastructure business is expected to grow 14 fold over the next five years, making it the center of the company’s future.
Here’s a quick look at what changed and why Wall Street is paying attention:
Today’s lineup:
Oracle Q1 FY26 highlights
What’s behind the OCI pump
Key quotes from the earnings call
What to watch next & Wen lambo !
1. Oracle Q1 FY26 Highlights
The $455 billion RPO surprise
RPO , future revenue from signed contracts , is a key sign of upcoming cloud growth. It rocketed 359% year over year (up from 63% the previous quarter). Converting RPO into actual revenue depends mainly on how many data centers are online and their available power.
Project Stargate enters the picture
For the first time, Oracle added Project Stargate to its RPO. This multibillion dollar AI infrastructure plan aims to build some of the largest data centers ever, potentially reaching $500 billion in scale over four years. Partners include SoftBank, OpenAI, NVIDIA, MGX, and Oracle itself.
Cloud revenue keeps climbing
Oracle’s overall cloud revenue rose 28% year over year to $7.2 billion:
Cloud Infrastructure (IaaS): Compute, storage, and networking grew 55% year over year to $3.3 billion, up from 49% in Q4. High-performance workloads and multi-cloud setups are driving this surge. This segment is where most of the RPO is expected to turn into revenue.
Cloud Applications (SaaS): Oracle’s enterprise apps , ERP, HCM, CRM , grew 11% year over year to $3.8 billion as companies continue shifting to cloud based systems.
The takeaway is clear: most of Oracle’s legacy revenue has leveled off. The real growth story now lies in OCI.
Income Statement
Revenue grew 12% year over year to $14.9 billion, coming in $260 million short of expectations:
Cloud: up 28% to $7.2 billion
Software: down 1% to $5.7 billion
Hardware: up 2% to $0.7 billion
Services: up 7% to $1.3 billion
Gross margin slipped to 67% (down 3 points year over year) and operating margin eased to 29% (down 1 point). Non GAAP EPS landed at $1.47, a penny shy of estimates.
Cash Flow
Operating cash flow over the trailing twelve months hit $21.5 billion, up 13% year over year. Free cash flow swung to an outflow of $5.9 billion as capital spending soared to $27.4 billion from $7.8 billion a year ago.
Balance Sheet
Cash and short-term investments: $11.0 billion
Debt: $91.3 billion
Making Sense of It
Backlog spike: Remaining performance obligations surged on four multi-billion-dollar contracts across three customers. Converting that backlog into revenue depends on how quickly Oracle can add data center capacity and power.
Cloud is the engine: OCI still makes up only about 22% of total revenue today, but growth is projected to accelerate to 77% year over year in FY26 (up from 70%) to reach $18 billion.
Multicloud momentum: Revenue from hyperscaler partnerships jumped 1,529%, with dozens more regions planned. Oracle’s database and OCI are riding on the existing footprints of AWS, Azure, and Google Cloud.
Execution challenge: Contracts are signed, but Oracle now needs to build out the infrastructure. CapEx guidance for FY26 rose to $35 billion from $25 billion. Power and construction speed are the main bottlenecks.
Customer concentration: A handful of massive customers , including the Stargate/OpenAI program , likely account for most of the backlog surge. Any delay in these projects could slow conversion to revenue.
Debt load: Unlike most of Big Tech, Oracle carries heavy leverage, with net debt over $80 billion. It also paid more than $5 billion in dividends last year despite negative free cash flow, leaving less financial flexibility if the market turns.
OCI outlook expands: The company now projects OCI revenue to climb to $18 billion in FY26, then to $32 billion, $73 billion, $114 billion, and $144 billion over the next four years — a 14× increase from FY25 to FY30.
2. The OCI pump Explained
Before getting carried away by the $455 billion backlog, it’s worth remembering: RPO isn’t cash.
What it is ? Contracted, non cancelable future revenue not yet recognized.
Total vs. current: Current RPO converts within a year; total RPO stretches across multiple years. The headline figure tells you little about near-term revenue.
Why it can mislead ? A few large multi-year deals can make RPO balloon overnight, but revenue only shows up as capacity is built and customers start using it.
One offs vs. run rate: Don’t annualize one big quarter. Heavy concentration in a few contracts especially Project Stargate means the pump isn’t steady or predictable.
Long stroy short, OCI revenue, utilization, and CapEx progress are better guides to future growth than RPO alone.
Project Stargate’s Role
The Wall Street Journal reports that OpenAI signed a roughly $300 billion compute purchase agreement with Oracle starting in 2027. Oracle’s RPO jumped $317 billion sequentially. If the enforceable portion of that agreement was booked at signing , as Oracle says it does , Stargate likely explains most of the spike and underpins the new OCI forecast.
Q1 FY26 Context
Management laid out a multi year OCI ramp to $144 billion within five years , growth on the scale of NVIDIA’s data center business.
At last year’s Financial Analyst Meeting, Oracle set a FY29 revenue target of $104 billion for the entire company. Based on the new OCI forecast, that figure is now likely above $160 billion, even if other segments stay roughly flat. Management hadn’t previously shared an OCI-specific revenue target, so the detail and scale of this plan are significant.
Who Are the Other Customers?
Oracle hasn’t confirmed names, but the likely list for these multi-billion-dollar deals is short and high profile:
OpenAI (Project Stargate): Publicly announced a 4.5 gigawatt US expansion with Oracle. Media reports suggest a mega-contract supporting this capacity.
xAI: Oracle and xAI introduced Grok models on OCI for training and inference in June, matching the timing and scale of a multi-billion-dollar commitment.
Meta: With a planned AI CapEx of $66–$72 billion in 2025 and additional spending in 2026, Meta’s profile aligns with a multi-year OCI commitment.
Oracle also plans to offer Gemini models via OCI alongside Database Google Cloud and expand multicloud data centers for AWS, Azure, and Google.
3. Key Quotes from the Earnings Call
CEO Safra Catz , AI demand and customer base:
“Oracle has become the go to place for AI workloads. We have signed significant cloud contracts with the who's who of AI, including OpenAI, xAI, Meta, NVIDIA, AMD and many others.”
The surge in demand is concentrated, which explains the backlog spike. Delivery and timing for a few mega customers will largely determine revenue conversion.
On multicloud database momentum:
“Multi cloud database revenue grew 1,529% in Q1..34 multi-cloud data centers now live and we will deliver another 37 for a total of 71”
Embedding Oracle inside AWS, Azure, and Google Cloud broadens reach and speeds enterprise migrations.
On the CapEx model:
“We do not own the property ,What we do own , is the equipment ,we put in that equipment only when it's time [and are] already generating revenue right away, I don't want to call it asset-light but it's asset pretty light.”
This approach allows for faster CapEx to revenue conversion and strong financial flexibility.
Chairman and CTO Larry Ellison – AI focus and efficiency:
On inferencing vs. training:
“The AI inferencing market will be much, much larger than the AI training market.”
On cost and performance:
“Our networks move data very, very fast if we're twice as fast, we're half the cost.”
On AI database & vectorization:
“With the introduction of our new AI database .. you can vectorize [all your data] and.. directly connect .. to ChatGPT, Gemini, Grok, Llama.. uniquely available in the Oracle Cloud.”
On ‘Butterfly’ private cloud:
“We have gotten the entire Oracle Cloud, the whole thing, every feature, ..into.. 3 racks, we call it Butterfly. That costs $6 million.”
These statements highlight Oracle’s competitive edge: fast, cost-efficient infrastructure, deep integration with AI models, and a scalable private cloud option for regulated workloads.
4. What to Watch Moving Forward
The headlines are exciting, but the key focus should be on execution and conversion.
Cash vs. CapEx: Oracle is front-loading spending and running negative free cash flow near term. Watch for free cash flow to improve as new data centers come online and start billing. Heavy leverage and steady dividends leave less flexibility than peers.
Hitting the targets: The five year OCI ramp is now the scoreboard. Utilization of new regions is critical for revenue to match forecasts. Management expects more deals, but execution will drive results.
Cycle duration: Execution depends on power availability, GPUs, and rollout cadence for AWS, Azure, and Google regions. A slowdown in enterprise AI demand could delay conversion, though the relatively “asset-light” model mitigates risk.
Mega customer risk: A few massive customers , Stargate/OpenAI, xAI, and others , carry outsized weight. Any delays in milestones, power, or contract terms could push back revenue recognition.
SO Like NVIDIA, Oracle is now deeply embedded in Big Tech’s AI build out. It’s a CapEx beneficiary rather than a discretionary vendor. As long as the AI expansion continues, OCI has a clear path for exceptional growth.
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Oracle teamed up with Microsoft to connect Azure IoT with Oracle Cloud SCM, improving real-time supply chain efficiency
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🟣MasterClass moonypto.com/masterclass
🟢Signal moonypto.com/signal
🔵News t.me/moonypto
⚪ t.me/moonyptofarsi
🟢Signal moonypto.com/signal
🔵News t.me/moonypto
⚪ t.me/moonyptofarsi
Verbundene Veröffentlichungen
Haftungsausschluss
Die Informationen und Veröffentlichungen sind nicht als Finanz-, Anlage-, Handels- oder andere Arten von Ratschlägen oder Empfehlungen gedacht, die von TradingView bereitgestellt oder gebilligt werden, und stellen diese nicht dar. Lesen Sie mehr in den Nutzungsbedingungen.