Larry Ellison, Oracle’s co‑founder and chief technology officer, appears at the Formula One British Grand Prix in Towcester, U.K., on July 6, 2025.
Jay Hirano | Sopa Images | Lightrocket | Getty Images
Oracle shares fell 7% in extended trading on Wednesday after the database software maker reported lower quarterly revenue than expected despite booming demand for its artificial‑intelligence infrastructure.
Here’s how the company performed versus LSEG consensus:
- Earnings per share: $2.26 adjusted vs. $1.64 expected
- Revenue: $16.06 billion vs. $16.21 billion expected
Revenue grew 14% year‑over‑year for the quarter ended Nov. 30, according to the company’s statement. Net income rose to $6.14 billion, or $2.14 per share, from $3.15 billion, or $1.13 per share, a year earlier. Adjusted earnings exclude stock‑based compensation.
Cloud revenue reached $7.98 billion, topping the $7.92 billion consensus among analysts. Cloud infrastructure contributed $4.1 billion, while software revenue slipped 3% to $5.88 billion, below the $6.06 billion average estimate.
Remaining performance obligations—a metric of contracted but unrecognized revenue—soared 438% to $523 billion, beating the $501.8 billion forecast. Chief financial officer Doug Kehring attributed the surge to new commitments from Meta, Nvidia and other enterprise customers.
Over the past decade Oracle has broadened its portfolio beyond traditional databases into cloud infrastructure, positioning itself against Amazon, Microsoft and Google for high‑value AI contracts. All three rivals are heavily investing in data‑center capacity and custom silicon to capture the AI‑driven workload boom.
OpenAI, the creator of ChatGPT, has pledged more than $300 billion in spending on Oracle’s infrastructure services over the next five years, underscoring the strategic importance of Oracle’s cloud offerings.
The earnings release arrives at a pivotal moment. Oracle has committed to a massive build‑out of AI‑grade infrastructure, a strategy that has expanded its revenue pipeline but also raised concerns about mounting debt levels. Investors are watching closely to see whether the company can sustain its growth momentum without overleveraging.
Oracle’s stock dropped 23% in November—the steepest monthly decline since 2001—and is now roughly 32% below its September record, though it remains up 34% year‑to‑date, outperforming the Nasdaq’s 22% gain over the same period.
In a leadership shuffle, the board appointed Clay Magouyrk and Mike Sicilia as co‑chief executive officers, succeeding Safra Catz. The new executives also unveiled AI agents designed to automate finance, human resources and sales processes, signaling a push toward AI‑enhanced enterprise productivity.
GAAP and adjusted earnings were buoyed by a $2.7 billion pre‑tax gain from the sale of chip designer Ampere, which SoftBank agreed to acquire for $6.5 billion in March. Oracle, an early investor in Ampere, decided to divest because it no longer views in‑house chip design as core to its cloud strategy.
“We have adopted a policy of chip neutrality,” said Larry Ellison, Oracle’s chairman and co‑founder. “We will continue to purchase the latest GPUs from Nvidia, but we must remain flexible to deploy whatever processors our customers choose.”
Management will discuss the results and provide guidance during a conference call that begins at 5 p.m. ET.
— Reporting from CNBC.
This is breaking news. Please check back for updates.
Original article, Author: Tobias. If you wish to reprint this article, please indicate the source:https://aicnbc.com/14357.html
