Oracle’s stock climbs on AI momentum, risks loom from $300B OpenAI bet
Oracle Corp. (ORCL) kicked off fiscal 2026 with strong results that caught Wall Street’s eye.
The company reported that total cloud revenue grew 27% to $7.2 billion, with cloud infrastructure revenue rising 54% to $3.3 billion, News.Az reports, citing foreign media.
Multi-cloud database services expanded even faster, with growth of more than 1,500% in the quarter.
In addition, Oracle reported earnings per share of $1.47, missing analysts’ forecasts by $0.01.
Analysts highlighted strong demand for Oracle Cloud Infrastructure, helped by contracts with OpenAI, xAI, Meta META, Nvidia, and Advanced Micro Devices AMD. This mix of growth pushed Oracle shares higher, with the stock gaining 36% in a single session, its best one-day rise since 1992.
The growth story, however, is closely linked to one customer. Oracle noted that its remaining performance obligations, or future revenue backlog, increased to $455 billion. Reports suggest most of this balance comes from a single agreement with OpenAI. The artificial intelligence firm is expected to spend more than $300 billion on Oracle compute over five years starting in 2027.
Yet OpenAI has not posted a profit and currently generates about $12 billion in recurring annual revenue. Analysts note that this level of spend would require OpenAI to expand revenue far beyond its current base. D.A. Davidson’s five-star analyst Gil Luria said Oracle’s backlog numbers are impressive but tempered by the fact that most of the growth is tied to one partner. JPMorgan’s five-star analyst Mark Murphy raised his price target to $270 but also flagged that Oracle’s contract details remain unclear.
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