Mixed signals at Oracle

Oracle reported strong earnings but announced fresh layoffs, raising questions about balancing cloud success against AI infrastructure ambitions.

Revenue climbs 30 percent

First quarter fiscal 2027 revenue hit $19.3 billion, up 30% year-over-year. Oracle delivered 300,000 GPUs and 850 MW of datacenter capacity.

Capital spending explodes upward

Oracle expects to spend $90 to $95 billion on capex in fiscal 2027, more than 66% above last year's $55.7 billion.

“Our CapEx for the quarter was $28 billion [up 235% y/y] leading to negative free cash flow of $5 billion.”

Spending approaches total revenue

For the first time, Oracle's capital expenditure could nearly match its expected $90 billion in total revenue for the year.

Debt reaches $125 billion

Oracle has accumulated $125 billion in debt as it pivots to supply AI infrastructure to Meta, OpenAI, SpaceX, and NVIDIA.

Circular deals with key customers

NVIDIA invested in OpenAI, which buys Oracle infrastructure, leading Oracle to invest in NVIDIA GPUs and incur debt doing so.

Fresh layoffs hit workforce

Oracle announced new layoffs this week, with rumors of 6,000 cuts. The workforce already dropped from 162,000 to 141,000 in fiscal 2026.

Stock drops over 50 percent

Oracle's stock has lost over half its value in the past year as investors question whether the AI infrastructure bet will pay off.