Shares of Oracle (NYSE:ORCL) jumped 39% in early trading on Wednesday after the tech giant released an ambitious cloud revenue forecast, overshadowing first-quarter fiscal results that slightly missed analyst expectations.
The surge pushed Oracle’s market capitalization to around $915.65 billion, edging it closer to the trillion-dollar valuations of peers like Microsoft and Apple. Year-to-date, the stock has more than doubled, driven by surging demand for AI-focused cloud services.
Oracle’s remaining performance obligations (RPO)—the company’s primary metric for booked revenue—soared 359% from a year earlier to $455 billion for the quarter ending August 31, far exceeding the $178 billion consensus estimate. CEO Safra Catz also signaled that “several additional multi-billion-dollar” clients are expected to sign on in the coming months.
“RPO stole the show […], reinforcing confidence in Oracle’s acceleration narrative,” analysts at Jefferies wrote in a note.
UBS strategists added: “[t]he scale of the backlog — […] with $317 billion of deals added in [the fiscal first quarter] alone — is so materially above Street estimates and drives such a material upward revision” to estimates for the firm’s 2028 fiscal year and beyond “that the stock deserves to re-rate materially higher, turning Oracle into perhaps the biggest large-cap growth acceleration story in all of tech.”
Oracle expects Oracle Cloud Infrastructure (OCI) booked revenue to surpass $500 billion—a forecast reflecting strong demand for its relatively low-cost, AI-powered services. OCI revenue is projected to rise 77% to $18 billion in the current fiscal year, then climb to $32 billion, $73 billion, $114 billion, and $144 billion over the following four years.
UBS analysts highlighted that this guidance, combined with Oracle’s expected full-year capital spending of $35 billion, is “bullish” for Nvidia (NASDAQ:NVDA), other AI hardware suppliers, and the ecosystem of partners building and financing Oracle’s GPU-powered data centers. GPUs are vital for handling massive datasets, making them critical for AI training and deployment.
During a post-earnings call, Catz emphasized that Oracle has made several popular AI reasoning models—such as OpenAI’s ChatGPT and xAI’s Grok—available to its clients.
The company’s fiscal first-quarter performance was more mixed. Adjusted EPS came in at $1.47, with revenue of $14.93 billion, slightly below FactSet estimates of $1.48 per share and $15.04 billion.
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