Oracle Soars 8% After Q4 Beat, Cloud Revenue and AI Demand Boost Bullish Outlook

Oracle Surges on Strong Cloud Results and Upbeat AI Growth Outlook

Oracle shares jumped 8% in after-hours trading Wednesday following a solid fourth-quarter earnings report that topped Wall Street expectations. The boost came as investors responded to accelerating cloud services growth and expanding AI initiatives that signal a shift in the company’s revenue engine.

How Did Oracle Beat Expectations?

Oracle posted adjusted earnings of $1.70 per share, beating analysts’ forecast of $1.64. Revenue rose 11% to $15.9 billion, surpassing the consensus estimate of $15.59 billion. The company’s cloud services and license support segment, its largest unit, delivered $11.7 billion in revenue — a 14% year-over-year gain and ahead of projections.

CEO Safra Catz emphasized the strength of Oracle Cloud Infrastructure (OCI) and its positioning in the AI boom. Catz projected that total cloud growth will jump from 24% in fiscal 2025 to over 40% the following year, underlining growing enterprise demand for Oracle’s AI-capable infrastructure.

What’s Fueling the Cloud and AI Expansion?

Cloud infrastructure revenue climbed 52% in the quarter, and Oracle is forecasting over 70% growth in fiscal 2026. This surge is being driven by AI-related workloads and new tools like Oracle’s AI Agent Studio, designed to help enterprises build custom AI solutions.

Oracle also secured strategic partnerships during the quarter, including collaborations with IBM and the UAE’s G42, alongside a healthcare AI initiative with Cleveland Clinic. Additionally, SoftBank’s $6.5 billion deal to acquire Oracle-backed chip firm Ampere highlights the firm’s growing influence in AI hardware infrastructure.

What Does This Mean for Oracle Investors?

With capital expenditures projected to exceed $21 billion in fiscal 2025 — up sharply from under $7 billion the prior year — Oracle is aggressively investing to support demand growth. Its strategy is increasingly focused on becoming a full-fledged cloud infrastructure provider, pivoting away from a software-first model.

Despite lagging the broader tech rally earlier in the year, Oracle shares are now up 6% year-to-date compared to a 2% rise for the S&P 500, indicating renewed investor confidence.

What Should Traders Watch Next?

Oracle executives are scheduled to provide forward guidance in a conference call at 21:00 GMT, where more details on AI investment plans and enterprise cloud deals could drive sentiment. Traders should monitor updates on OCI demand and any revisions to the company’s fiscal 2025 outlook as key signals for sustained momentum.

More Information in our Economic Calendar.