Oracle’s (ORCL) latest earnings report offered a glimpse into just how expensive the artificial intelligence race is becoming, with the technology giant unveiling plans to raise around $40 billion to help finance a massive expansion of its data centre network.
The announcement accompanied a stronger-than-expected set of fourth-quarter results, as Oracle posted earnings per share of $2.11 on revenue of $19.18 billion, comfortably ahead of Wall Street forecasts.
Revenue climbed from $15.9 billion a year earlier, while earnings rose sharply from $1.70 per share, reflecting the growing contribution from cloud and AI-related services.
Investors have become increasingly focused on whether Oracle can keep up with the unprecedented demand for computing power generated by artificial intelligence models.
The company appears convinced that demand is not slowing, which helps explain why it is preparing to tap both debt and equity markets for one of the largest fundraising efforts in its history.
Cloud revenue came in at $9.91 billion, just below analyst expectations of $9.99 billion. The shortfall was largely driven by Cloud Applications revenue, which missed forecasts by a narrow margin, although Cloud Infrastructure revenue exceeded expectations and continued to be one of the strongest areas of growth.
More revealing was Oracle’s remaining performance obligations, a measure of contracted business still waiting to be delivered. The figure surged to $638 billion, smashing expectations of $589.5 billion and suggesting customers are continuing to sign large, long-term agreements despite concerns about the broader economy.
That backlog has become one of the most closely watched figures in the technology sector because it offers a window into future demand. For Oracle, it points to a pipeline that continues to swell as companies rush to secure cloud capacity for AI projects.
Oracle’s ties to OpenAI continue to strengthen its position in the AI infrastructure market. Interest in that partnership has intensified after the ChatGPT developer confidentially filed for a stock market listing, bringing renewed focus to the five-year agreement signed between the two companies in 2025.
Valued at $300 billion, the deal cemented Oracle’s role as a critical infrastructure provider for OpenAI’s ambitions and helped position the company at the centre of the AI buildout taking place across the technology industry.
Oracle also reaffirmed its target of reaching $90 billion in annual revenue by 2027, indicating that management remains confident its heavy investment programme will translate into sustained growth.
That confidence marks a sharp contrast to investor sentiment late last year when Oracle shares stumbled following a disappointing outlook and concerns over rising spending commitments.
Since then, a stronger third-quarter performance, an upgraded long-term outlook and continued enthusiasm around AI infrastructure have helped repair confidence.
