Key Takeaways:
- The revenue rose 21% to $19.18 billion in the quarter
- The cloud revenue increased 47% while infrastructure grew 93%
- The company plans to raise $40 billion to fund AI expansion
Oracle reported higher-than-expected earnings and revenue for its fiscal Oracle Q4 earnings ended May 31, 2026, supported by continued growth in its cloud and artificial intelligence-related services.
The company posted adjusted earnings per share of $2.03 compared to expectations of $1.96, while revenue reached $19.18 billion against estimates of $19.10 billion. Net income increased to $4.22 billion from $3.43 billion a year earlier.
Cloud growth drives revenue expansion
Oracle’s total revenue grew 21% year over year, reflecting strong demand for cloud services and infrastructure. Cloud revenue rose 47% to $9.91 billion during the quarter, driven by increased enterprise adoption of cloud-based solutions.
Within this segment, cloud infrastructure revenue recorded a 93% increase to $5.8 billion, indicating rapid growth in demand for computing capacity linked to artificial intelligence workloads. Software revenue, including licenses and support, stood at $6.82 billion, declining 2% but remaining above expectations.
The company’s remaining performance obligation, which represents contracted future revenue, increased 363% to $638 billion. A significant portion of this growth was attributed to artificial intelligence contracts, where customers prepaid for graphics processing units or supplied them directly.
Oracle stated that these arrangements reduce its own capital requirements for building data center capacity, as customers share part of the infrastructure cost burden.
For the upcoming fiscal first quarter, the company projected adjusted earnings per share between $1.72 and $1.76, with expected revenue growth of 27% to 29%. This outlook is higher than analyst expectations of $1.68 per share and reinforces the positive outlook following the latest Oracle Q4 earnings report
Capital spending and funding plans expand
Oracle maintained its long-term revenue guidance of $90 billion for fiscal 2027 while raising its adjusted earnings forecast to $8.05 per share from earlier estimates. The updated projection exceeds expectations of $8.01 per share and $88.9 billion in revenue.
To support its artificial intelligence expansion, Oracle plans to raise $40 billion through a combination of debt and equity. This includes a previously announced $20 billion share sale. The company had already raised $43 billion in debt and $5 billion in equity during fiscal 2026. underscoring the growth strategy highlighted in the latest Oracle Q4 earnings announcement.
Capital expenditures increased 162% to $55.7 billion during the fiscal year, reflecting heavy investment in infrastructure. Depreciation nearly doubled to $7.62 billion, contributing to the negative free cash flow of $23.7 billion for the year.
Looking ahead, Oracle expects capital spending to reach around $70 billion in fiscal 2027, excluding $20 billion to $25 billion in customer prepayments. The company also aims to bring nearly 1 gigawatt of computing capacity online in the current quarter, matching its total capacity added in fiscal 2026.
In addition, funding has been secured for a $16 billion data center site in Michigan, highlighting the continued expansion of physical infrastructure to support cloud and artificial intelligence services.
Oracle’s financial results reflect a combination of strong revenue growth and increased investment in infrastructure, with artificial intelligence demand playing a central role in both performance and future planning.
