"On Wednesday, Oracle announced revenue and profit forecasts that fell short of analysts' expectations. At the same time, the company announced it would increase spending by $15 billion (€12.8 billion). Oracle's share price fell by 10 percent in after-hours trading. Oracle plays a prominent role in the AI race with ambitious plans to build AI cloud data centers. The company previously signed a five-year, $300 billion contract with OpenAI."
"For the current fiscal third quarter, Oracle forecasts adjusted earnings between $1.64 and $1.68 per share. That remains below analysts' expectations of $1.72 per share. The revenue growth forecast of 16 to 18 percent also lags behind the estimated 19.4 percent growth to $16.87 billion. The recently concluded fiscal second quarter shows a similar picture. Oracle reported total revenue of $16.06 billion, while analysts had expected an average of $16.21 billion. Adjusted operating profit of $6.7 billion also fell short of the average target of $6.8 billion."
"Oracle's management anticipates capital expenditures for fiscal year 2026 will be $15 billion higher than the $35 billion the company estimated in September during its first-quarter earnings report. This increased spending is related to Oracle's large-scale AI infrastructure investments. The company is building several new data centers in various locations across the United States as part of the Stargate project. During a conference call, CEO Clay Magouyrk was asked how Oracle will finance the construction of the data centers needed for the cloud contracts."
Oracle forecasted adjusted earnings of $1.64–$1.68 per share for the fiscal third quarter, below analysts' $1.72 estimate, and projected revenue growth of 16–18%, under the 19.4% expected. Second-quarter revenue of $16.06 billion and adjusted operating profit of $6.7 billion also missed analyst averages. Management raised fiscal 2026 capital-expenditure plans by $15 billion above a prior $35 billion estimate to fund large-scale AI infrastructure. The company is constructing multiple Stargate AI cloud data centers across the United States and holds a five-year, $300 billion contract with OpenAI. Shares fell about 10% in after-hours trading, and management mentioned alternative financing models including customer-provided chips.
Read at Techzine Global
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