Oracle beats on earnings, but stock drops on plans to raise another $20 billion
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- Oracle beat Q4 earnings ($2.03 adj EPS vs. $1.96 expected) and revenue ($19.18B vs. $19.10B expected), yet shares dropped 10% in extended trading on plans to raise another $20 billion in equity.
- Oracle plans to raise $40 billion total through debt and equity financing — including a previously announced $20 billion share sale — after already raising $43 billion in debt and $5 billion in equity in fiscal 2026.
- Oracle's remaining performance obligation surged 363% to $638 billion, with over 50% tied to OpenAI, according to Bank of America analysts.
- Oracle's cloud infrastructure revenue jumped 93% year-over-year to $5.8 billion in the quarter, while total cloud revenue rose 47% to $9.91 billion — compared to AWS's $37.59 billion in the same period.
- Oracle's capital expenditures jumped 162% to $55.7 billion, producing $23.7 billion in negative free cash flow for the fiscal year, with fiscal 2027 net capex expected around $70 billion.
- Hilary Maxson, a Schneider Electric executive, joined Oracle as its new chief financial officer during the quarter, replacing the prior finance leadership.
Why it matters: Oracle's $638 billion RPO — up 363% — shows AI demand is real and prepaid, but the $70 billion net capex planned for fiscal 2027 stacks on top of a $20 billion equity raise already announced. Oracle's stock is flat year-to-date while the S&P 500 is up 6%, and its $5.8 billion in cloud infrastructure revenue still trails AWS's $37.59 billion.
