Oracle Cloud Revenue Jumps 121% as Backlog Reaches $664 Billion

EarningsCorporate Action Impact 5
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Summary · why it matters

Oracle Corporation reported on September 10 that its revenue rose 30% in the fiscal first quarter, driven by a 121% jump in cloud infrastructure revenue, the business that rents computing power to AI companies. The company said its remaining performance obligations, the value of contracts signed but not yet delivered, reached $664 billion, more than seven times the revenue it expects this year, and on the back of that backlog Oracle raised its full-year revenue outlook to at least $90 billion. Roughly half of the backlog should turn into revenue within three years, more than three times what the company expects to collect in the whole of this year, and Oracle signed more than $30 billion of new AI cloud deals in the quarter, most structured as prepayments or customers bringing their own hardware. Delivering that backlog is costly: Oracle spent $28.5 billion on data centers and equipment in a single quarter, more than the cash its business generated, free cash flow stayed negative, gross margin fell more than five points to 61%, and a day after the results the company expanded its job-cut plan. Concentration risk looms as well, since a $300 billion contract with OpenAI signed last year begins in 2027 and is close to half of the current backlog, while OpenAI is still losing money. Management has pointed to an investor day in October for a fuller plan on margins and cash flow ahead of the next quarterly report in December.

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Cloud & Digital Infrastructure · 1 stocks
Oracle Corporation
ORCL
▲ PositiveCapitalrelevance

Q1 revenue rose 30% on 121% cloud infrastructure growth, backlog hit $664B, and full-year revenue outlook was raised to at least $90B

Energy Transition & Power Demand · 1 stocks

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Its $300B Oracle contract is nearly half the backlog but starts in 2027 and OpenAI is still losing money

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