Oracle Corp (NYSE:ORCL, XETRA:ORC) reported better-than-expected fourth-quarter results on Wednesday, driven by surging demand for artificial intelligence infrastructure.
However, its plans to raise approximately $40 billion through a combination of debt and equity to fund its AI datacenter buildout in fiscal 2027 sent shares falling nearly 9% in after-hours trading.
Revenue rose 21% year-over-year to $19.2 billion, topping analyst estimates of around $19.1 billion. Adjusted earnings per share came in at $2.11, ahead of the $1.97 consensus, while operating income reached $8.6 billion against expectations of $8.3 billion.
Cloud revenue climbed 47% to $9.9 billion, with Oracle Cloud Infrastructure posting particularly sharp growth of 93% to $5.8 billion.
Remaining performance obligations, a closely watched measure of future contracted revenue, rose 33% to $138 billion and increased $35 billion from the prior quarter, driven largely by large-scale AI contracts signed in the third and fourth quarters.
The $40 billion financing effort is intended to reduce the capital burden on Oracle by incorporating prepaid and customer-supplied hardware arrangements into its AI infrastructure expansion. The company said $75 billion in AI contract hardware has been either prepaid or customer-supplied, a structure that offsets how much Oracle must raise independently.
For the first quarter, Oracle guided for revenue growth of 27% to 29% and cloud growth of 58% to 64%, with adjusted EPS of $1.72 to $1.76, modestly above the $1.69 analyst estimate. The company set a full-year revenue target of approximately $90 billion, above the consensus range of $88.5 billion to $89 billion, and projected adjusted EPS of $8.05.
