Oracle Corporation (NYSE:ORCL) reported quarterly results on Tuesday that exceeded analysts’ expectations for both revenue and profit, driven by continued strong expansion in its cloud computing business. The company also lifted its fiscal 2027 revenue forecast, pushing its shares roughly 10% higher in premarket trading on Wednesday.
The Austin, Texas-based technology group has increasingly focused on cloud infrastructure in recent years, while its traditional products—including database software and enterprise applications for finance—continue to generate significant revenue.
Oracle reported adjusted earnings of $1.79 per share on revenue of $17.19 billion for the third quarter of fiscal 2026. Analysts had projected earnings of $1.70 per share on revenue of $16.92 billion.
Growth was led by the company’s cloud division, where revenue surged 44% year over year to $8.91 billion.
Barclays analyst Raimo Lenschow said the results suggest “a clearer path ahead.”
“With fundamentals becoming more visible, we can start looking at fundamental valuations again,” Lenschow wrote in a post-earnings note. “The ~16x PE ratio (CY27) for a company that will grow revenue and earnings over 30% in the coming years seems very attractive to us.”
He maintained an Overweight rating on the stock and raised his price target to $240 from $230.
Oracle has strengthened its position in the artificial intelligence sector through significant investment in data center infrastructure. The company was identified by the U.S. government last year as a key participant in the Stargate project.
“The demand for cloud computing for AI training and inferencing continues to grow faster than supply. Furthermore, some of the largest consumers of AI Cloud capacity have recently strengthened their financial positions quite substantially. These market dynamics enable Oracle to comfortably meet and likely exceed our revenue growth rate forecast for FY27 and beyond,” the company said in a statement.
Since being selected for the Stargate initiative, Oracle has undertaken several fundraising efforts to finance its expanding data center network, including plans to raise up to $50 billion through a mix of debt and equity financing this year.
Oracle shares have faced sustained pressure since reaching an intraday high of $345.72 in early September last year. The stock has declined about 54.5% since that peak.
Regarding its outlook, Oracle now expects fiscal 2027 revenue to reach $90 billion. The company left unchanged its fiscal 2026 revenue projection of $67 billion and its planned capital expenditure of $50 billion.
For the fourth quarter of fiscal 2026, Oracle forecasts total revenue growth of between 19% and 21% in U.S. dollar terms. Revenue from cloud services is expected to increase between 46% and 50%.