Oracle delivered a stronger than expected third quarter on Tuesday, topping analyst forecasts on both earnings and revenue and raising its 2027 revenue guidance to $90 billion. The results sent shares jumping more than 10% in premarket trading Wednesday morning, offering a rare moment of relief for investors who had watched the stock lose more than half its value over the prior six months.
The company posted earnings per share of $1.79 against expectations of $1.70, while revenue came in at $17.19 billion, clearing the $16.9 billion estimate. In the same quarter a year earlier, Oracle reported $1.47 per share on revenue of $14.1 billion, making the year over year growth hard to ignore.
Oracle’s cloud business carries the momentum
The cloud segment was a particular bright spot, bringing in $8.9 billion against a forecast of $8.8 billion. Cloud infrastructure sales reached $4.9 billion, ahead of the $4.74 billion estimate. Those numbers matter because they speak directly to Oracle’s positioning in the artificial intelligence infrastructure race, an area the company has committed to in a very expensive way.
Capital expenditures have ballooned dramatically over the past year, jumping as much as 269% in the first quarter to $8.5 billion. The company now expects full year capital expenditures to hit $50 billion, a figure that underscores just how aggressively Oracle is betting on AI data center expansion.
The data center drama in the background
The earnings report arrived alongside a pair of news stories that had rattled investor confidence in recent days. One report suggested Oracle and OpenAI had scrapped plans to expand their Stargate data center project in Abilene, Texas, potentially opening the door for Meta to begin talks with developer Crusoe about leasing the site.
Oracle pushed back on that account publicly, stating that reports about the Abilene site were false and incorrect and that two buildings at the campus were already fully operational with the rest of the development on track. The company also said it had completed leasing for an additional 4.5 gigawatts to fulfill its commitments to OpenAI.
A separate report also surfaced claiming Oracle was planning to cut thousands of workers, a move analysts interpreted as a way to offset the enormous cost of its data center buildout. Oracle has not confirmed those figures.
Oracle is not alone in its spending spree
The pressure Oracle faces from investors skeptical of sky high capital expenditure is hardly unique. Amazon, Google, Meta and Microsoft are collectively expected to pour roughly $650 billion into capital expenditures in 2026, with the bulk of that directed at AI infrastructure.
Markets have not rewarded that ambition uniformly. Microsoft shares are down 16% since the start of the year. Amazon has slipped more than 7% in the same stretch. Google and Meta have fared somewhat better, each declining a relatively modest amount.
A stock trying to find its footing
Oracle’s own trajectory has been one of the steeper rides in the sector. After climbing to a high of $345.72 in September, shares had fallen to around $149 by Tuesday afternoon, reflecting a decline of roughly 54% over six months and 23% since January. Wednesday’s premarket surge offered a breath of fresh air, though analysts remain watchful of whether the results signal a genuine turning point or a temporary bounce in a still uncertain market.
With a $90 billion revenue target now on the books for 2027, Oracle is making a loud statement about where it expects to be. Whether the infrastructure spending required to get there continues to spook investors or eventually wins them over may define the company’s story for the rest of the year.
