Oracle Q4 Results Strong, Outlook Positive, But Stock Drops On Plan To Raise $20 Bln More

(RTTNews) - Tech major Oracle Corp. issued first-quarter outlook expecting higher results, and raised fiscal 2027 earnings view, after reporting significant growth in fourth-quarter results driven by Cloud Infrastructure & Cloud Applications.

Meanwhile, the shares were losing around 10 percent in the pre-market activity on the NYSE, after the firm said it expects to raise around $20 billion more through a combination of debt and equity financing.

Regarding the capital investment program and capital funding, Oracle said it expects to raise approximately $40 billion in fiscal 2027 including its previously announced $20 billion at-the-market equity issuance. In fiscal year 2026, Oracle raised $43 billion in debt financing and $5 billion in equity financing, and does not expect to issue additional debt in calendar year 2026.

Looking ahead for the first quarter, the company projects adjusted earnings per share to grow between 17 percent and 20 percent to between $1.72 and $1.76.

Total revenues are expected to increase from 27 percent to 29 percent, in both reported and constant currency basis. Total Cloud revenue is expected to grow between 58 percent and 64 percent on a reported basis and between 57 percent and 63 percent in constant currency.

Further ahead, for fiscal 2027, the company said it raised adjusted earnings per share guidance to $8.05. Adjusted earnings per share would be higher 18% year-over-year after adjusting for last year's one-time events of selling Ampere chip business and Bloom Energy warrants.

Oracle confirmed prior revenue guidance of $90 billion for the full year.

In fiscal 2026, earnings per share were $5.83, and adjusted earnings per share were $7.63, on revenues of $67.4 billion.

Further, the board of directors declared a quarterly cash dividend of $0.50 per share of outstanding common stock, payable on July 24 to stockholders of record on July 10.

In the fourth quarter, net income available to shareholders totaled $4.22 billion, higher than $3.43 billion last year. Earnings per sare climbed 21 percent to $1.45 from $1.19 a year ago.

Adjusted earnings were $6.15 billion or $2.11 per share for the period, compared to $4.88 billion or $1.70 per share last year.

Oracle generated operating income of $6.13 billion, up 20 percent year-over-year, while adjusted operating income grew 22 percent to $8.6 billion, driven by strong revenue growth and operating efficiency actions taken during the quarter.

The company's revenue for the period rose 20.6 percent to $19.18 billion from $15.90 billion last year, reflecting broad-based demand for Oracle's industry-leading cloud technology and applications suites. Revenue growth was 20 percent constant currency.

Total cloud revenues climbed 47 percent to $9.9 billion, with Cloud Infra (IaaS) revenue up 93 percent and Cloud Apps (SaaS) revenue up 10 percent.

Meanwhile, Software revenues were down 2 percent to $6.8 billion, reflecting customers' continuing migration from on-premise software to the Cloud.

Services revenues were $1.5 billion, up 13 percent, and Hardware revenues were $0.9 billion, up 9 percent.

Remaining Performance Obligations, or RPO, ended the quarter at $638 billion, up 363% year-over-year.

According to the company, the large increases in Oracle's RPO and revenue were driven by the growing demand for cloud infrastructure for AI training and inferencing.

In the pre-market activity on the NYSE, the shares were down 10 percent, at $183.18, extending the loss of 2.21 percent at the closing of Wedneday's regular trading.

For more earnings news, earnings calendar, and earnings for stocks, visit rttnews.com.