Oracle Stock Is Selling Off on Its Massive AI Spending Plans. Here's Who Gets Paid When Oracle Spends.
The database giant's stock dropped after capital spending came in well above its own forecast. But that spending is revenue for the companies filling its data centers.
Oracle Stock Is Selling Off on Its Massive AI Spending Plans. Here's Who Gets Paid When Oracle Spends.
Overview
Oracle (NYSE: ORCL) shares are selling off. The database giant reported results for its fiscal fourth quarter of 2026 (the period ended May 31, 2026) Wednesday afternoon. The stock fell as much as 11% in early trading Thursday and finished the trading day down about 8.5%.
The quarter itself wasn't weak. Revenue rose 21% year over year to $19.2 billion, with cloud revenue jumping 47% to $9.9 billion. And remaining performance obligations (contracted revenue the company hasn't yet delivered) ballooned to $638 billion -- up $85 billion in just three months.
Details
Instead, investors seem focused on the bill. Oracle's capital expenditures hit $55.7 billion in fiscal 2026 -- above the $50 billion management forecast in March -- and free cash flow came in at negative $23.7 billion. Further, spending is set to climb again in fiscal 2027, with management guiding for a net cash outlay of about $70 billion after customer prepayments. And Oracle plans to raise about $40 billion in new debt and equity.
Source
Originally published at www.fool.com.
