Oracle Corp (NYSE:ORCL) is jumping in premarket trading Wednesday. Strong quarterly results and bold AI-driven guidance are driving the move.
Oracle Smashes Q3 Revenue And Earnings Estimates
Oracle reported third-quarter fiscal 2026 revenue of $17.19 billion. That beat analyst estimates of $16.91 billion.
Adjusted earnings per share rose 21% year-over-year to $1.79. Estimates called for $1.71 per share.
Cloud Segment Breakdown Shows Broad Strength
The cloud business fired on all cylinders last quarter.
Cloud Infrastructure revenue hit $4.9 billion, up 84% year-over-year. Cloud Applications brought in $4 billion, up 13%. Fusion Cloud enterprise resource planning (ERP) grew 17% to $1.1 billion. NetSuite Cloud ERP matched that figure, also up 14%.
Oracle ended the third quarter with roughly $38.46 billion in cash.
Guidance Tops Expectations; AI Demand Called A Long-Term Driver
Oracle guided for fourth-quarter revenue growth of 18% to 20% year-over-year. Total cloud revenue is expected to rise 44% to 48%. Adjusted EPS guidance of $1.96 to $2.00 edges past the $1.95 consensus.
Full fiscal 2026 revenue guidance holds at $67 billion. For fiscal 2027, Oracle projected $90 billion — above the $86.63 billion analyst estimate.
Management pointed squarely at AI as the catalyst.
AI Data Centers Already Profitable, But Construction Costs Bite
Oracle Co-CEO Clay Magouyrk addressed margin questions directly on the earnings call Tuesday.
He told analysts that AI infrastructure is already delivering 30% to 40% gross margins on AI accelerators. Adjacent cloud services — compute, storage, security, networking — add another layer of profitability, carrying margins of 60% to 80%.
He acknowledged one drag: aggressive expansion. Oracle is building multiple data centers simultaneously. Some costs land before facilities go live.
ORCL Price Action: Oracle shares were up 10.11% at $164.51 during premarket trading on Wednesday, according to Benzinga Pro data.
Photo by Rokas Tenys via Shutterstock
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