Oracle Corporation (ORCL) Earnings

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Nov 2026upcoming

Next quarter

Expected to report Dec 9, 2026 — estimated from last year’s reporting date.

Consensus is $1.54 EPS for Nov 2026 across 11 estimates, ranging $1.45 to $1.62.

ORCL Aug 2026

Reported Sep 10, 2026 · after the close

: 17.27%
: -1.74%

: $1.39
: $1.63
: —
: $19.34B

Reported results

: $19.34B; from $14.93B
: $6.73B; from $4.28B
: 34.78%; from 28.65%
: $4.76B; from $2.93B
: $1.56; from $1.01

Highlights

Cloud infrastructure: Revenue rose 121% year over year to $7.4 billion, driving total cloud revenue up 62% to $11.6 billion.
Top-line acceleration: Total revenue increased 30% year over year to a record $19.3 billion and rose 12.5% sequentially from $17.2 billion in Q4 FY2026.
Earnings beat: Supplied reported EPS of $1.63 exceeded the $1.39 consensus by 17.27%; GAAP diluted EPS was $1.56, up 55% year over year, while non-GAAP EPS was $1.92, up 30%.
Backlog: Remaining performance obligations reached $664 billion, up $209 billion year over year and $26 billion sequentially, after more than $30 billion of new AI cloud contracts.
Capacity delivery: Oracle brought 850 megawatts of additional data-center capacity online and delivered more than 300,000 GPUs in the quarter, nearly triple Q4 FY2026's capacity delivery.
Cash investment: Operating cash flow increased 184% to $23.1 billion, but $28.5 billion of capital expenditures produced negative free cash flow of $5.4 billion.
Funding model: Oracle completed a $20 billion at-the-market equity issuance, selling approximately 141 million common shares for $19.9 billion net, while customer prepayments contributed $11.4 billion of operating cash flow.
Raised outlook: Management now expects fiscal 2027 revenue of at least $90 billion and non-GAAP EPS of $8.10; Q2 revenue is guided to grow 30%-34% and cloud revenue 65%-71% in USD.

Analysis

Oracle's Q1 FY2027 was an acceleration quarter, with revenue growth, cloud infrastructure delivery and backlog conversion all moving higher. Revenue of $19.34 billion increased 30% from $14.93 billion a year ago and 12.5% from $17.19 billion in Q4 FY2026. GAAP operating income rose 57% year over year to $6.73 billion, while net income increased 60% to $4.76 billion. The supplied reported EPS of $1.63 beat the $1.39 consensus by 17.27%; the filing reports GAAP diluted EPS of $1.56 versus $1.01 a year ago and $1.27 in the prior quarter, while non-GAAP EPS reached $1.92.

The print was defined by OCI: infrastructure revenue more than doubled to $7.4 billion, following 93% growth in Q4, as Oracle delivered 850 megawatts of new capacity. More than $30 billion of AI contracts lifted RPO to $664 billion, although management said most new contracts will not affect revenue or capital needs until fiscal 2028 or later. The trade-off is heavy investment: capex rose to $28.5 billion from $8.5 billion a year ago, leaving free cash flow negative despite record operating cash flow. Management offset part of the funding requirement with $19.9 billion of equity proceeds and $11.4 billion of customer prepayments, and raised the full-year revenue outlook to at least $90 billion.

Cloud infrastructure demand

OCI was the central driver of the quarter. Cloud infrastructure revenue increased 121% year over year to $7.388 billion, compared with 93% growth in Q4 FY2026, and accounted for 91% of constant-currency cloud revenue growth. Cloud applications grew 10% to $4.219 billion, leaving total cloud revenue up 62% to $11.607 billion.

Capacity: Oracle delivered 850 megawatts of AI capacity containing more than 300,000 GPUs; Q1 delivery was almost three times Q4's and included 131,000 GPUs at the Abilene site.
Utilization and pricing: GPU utilization was 97.9%, and capacity coming up for renewal was renewed or resold at a 20% premium to prior contracts.
Database cloud: Multicloud database revenue grew 353% year over year and multicloud customers increased 180%; Oracle reached 70 multicloud database regions and 119 availability zones.

Backlog conversion

RPO rose to $664 billion from $455 billion a year earlier and increased $26 billion sequentially. Oracle booked more than $30 billion of additional AI cloud contracts during the quarter. Management said roughly half of RPO should convert to sales over the next 36 months, but most new Q1 contracts will not affect revenue or capex until fiscal 2028 or beyond.

Funding structure: Many new contracts use customer prepayments, bring-your-own-hardware arrangements or supplier financing, reducing the need for incremental cash from Oracle without eliminating the underlying capital requirement.
Near-term conversion: The company began converting its existing backlog more rapidly into revenue, which management linked to the 121% OCI growth rate and the sequential increase in total company revenue.

Margins and earnings

GAAP operating income increased 57% to $6.728 billion, lifting the GAAP operating margin to 35% from 29% a year earlier. Non-GAAP operating income rose 31% to $8.151 billion, with the non-GAAP margin broadly stable at 42%. Infrastructure ramp costs lowered gross margin, but lower sales and marketing costs, lower R&D expense and operating leverage offset that pressure.

Reported earnings: Net income available to common shareholders was $4.679 billion versus $2.927 billion a year earlier; GAAP diluted EPS was $1.56 versus $1.01.
Cost actions: Sales and marketing expense fell 12% to $1.811 billion, R&D expense fell 4% to $2.401 billion, and restructuring expense declined to $94 million from $415 million.
Financial drag: Interest expense rose 55% to $1.428 billion, reflecting higher average borrowings after $43 billion of senior-note issuance in fiscal 2026.

Capital intensity and funding

Oracle's growth is consuming substantial cash as it expands data-center capacity. Capital expenditures reached $28.499 billion, up from $8.502 billion a year ago, producing free cash flow of negative $5.396 billion. Management expects fiscal 2027 capex of $90 billion-$95 billion, including no more than $70 billion of net cash capex.

Operating cash flow: Cash flow from operations reached a record $23.103 billion, up 184%, helped by $11.363 billion of customer prepayments with a significant financing component.
Equity financing: Oracle issued approximately 141 million shares through its ATM program for $19.909 billion net, completing the previously disclosed $20 billion program.
Balance sheet commitments: Property, plant and equipment rose to $127.845 billion from $99.957 billion at May 31, 2026, while the company disclosed $288 billion of additional data-center lease commitments expected to commence from Q2 FY2027 through fiscal 2029.

Applications and AI stack

The applications business remained a supporting growth engine rather than the main quarter-to-quarter driver. Cloud applications revenue rose 10% to $4.219 billion, with Fusion growing 14% and industry applications growing more than 20%. Management positioned embedded AI and agentic workflows as ways to improve adoption and shorten implementation cycles, while also creating cross-selling opportunities into OCI.

AI usage: Customers used embedded AI capabilities more than 150 million times in the quarter, up 42% sequentially; AI agents executed more than 3.5 million times, nearly doubling quarter over quarter.
Customer base: More than 2,300 AI agents were in production, up 90% sequentially, and Fusion AI usage consumed 900 billion tokens during the quarter.
New products: Oracle made NetSuite Next generally available, introduced an AI Data Platform that automates enterprise ontologies across data sources, and announced a fully agentic health-care management and EHR system.

Raised fiscal outlook

Management raised its fiscal 2027 outlook after the strong Q1 execution. The guidance embeds continued OCI acceleration while recognizing that gross margin will remain pressured as data-center capacity ramps.

Q2 FY2027: Revenue is expected to grow 30%-34% in USD, cloud revenue 65%-71%, and non-GAAP EPS is guided to $1.85-$1.93.
Full year: Revenue is expected to reach at least $90 billion, implying at least 34% growth, and non-GAAP EPS is expected to be $8.10.
Margin trajectory: Management expects gross margin to flatten after the current ramp, while continuing to prioritize operating margin and cash generation as infrastructure projects mature.

Oracle Corporation

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