Oracle shares rose 4 percent in extended trading after the company reported a revenue backlog that sailed past estimates and a cash burn that came in far lighter than feared, offering momentary relief to a stock that has shed more than a fifth of its value this year.
Backlog beats on AI contracts
The first fiscal quarter added more than $30 billion in new AI cloud contracts, lifting the revenue backlog to $664 billion against a $639.89 billion consensus. Management said the bulk of that contracted revenue will not demand heavy chip outlays, letting Oracle keep its annual capital expenditure target between $90 billion and $95 billion.
Cash flow relief
Negative free cash flow of $5.40 billion compared with a $9.56 billion analyst expectation, a sizable gap that also improved on the prior quarter and the $11.48 billion burn recorded in the third quarter of fiscal 2026. Capital expenditure hit $28.50 billion, though customer prepayments covered $11.36 billion of it.
Earnings and guidance
Revenue climbed 30 percent to $19.3 billion, topping the $19.14 billion estimate, while adjusted earnings of $1.92 a share beat the $1.74 projection. The company lifted its fiscal 2027 adjusted profit forecast to $8.10 a share from $8.05, above the $8.07 average estimate, and reiterated a revenue target of at least $90 billion.
Context
The print arrives after a July downgrade from S&P Global that flagged weak cash flow and rising business risk. Valoir chief executive Rebecca Wettemann said the results show customers are voting with their wallets and that Oracle must keep proving the backlog story extends beyond a single large customer.