{"id":1077,"date":"2026-03-11T00:27:47","date_gmt":"2026-03-11T00:27:47","guid":{"rendered":"https:\/\/stock999.top\/?p=1077"},"modified":"2026-03-11T00:27:47","modified_gmt":"2026-03-11T00:27:47","slug":"oracle-called-this-its-best-quarter-in-15-years-its-free-cash-flow-just-hit-negative-24-7-billion","status":"publish","type":"post","link":"https:\/\/stock999.top\/?p=1077","title":{"rendered":"Oracle called this its best quarter in 15 years \u2014 its free cash flow just hit negative $24.7 billion"},"content":{"rendered":"

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Oracle called the third quarter of fiscal 2026 its best in 15 years with revenue up 22% to $17.2 billion and cloud infrastructure up 84% to $4.9 billion. The market rejoiced, sending the stock up nearly 10% in after-hours trading on Tuesday.<\/p>\n

Despite the market\u2019s ebullience, the enterprise software giant is blowing through cash at a steadily rising pace. Just three quarters ago, Oracle\u2019s free cash flow was essentially zero, and this quarter it clocked in at negative $24.7 billion over the trailing 12 months as its capital expenditures rocketed from $21.2 billion in fiscal 2025 to a guided $50 billion this fiscal year as the company forges ahead in its AI data center buildout.\u00a0<\/p>\n

Chief financial officer Doug Kehring said after the market closed that Oracle would offer up more information about its capital expenditures for fiscal 2027 next quarter.<\/p>\n

\u201cI think we\u2019ll get back to everyone at the end of the fiscal year and talk about next year\u2019s capex at that point,\u201d said Kehring in response to a question. However, he flagged that Oracle is working on financing structures where future spending doesn\u2019t come out of Oracle\u2019s pocket but instead can be paid for by customers paying for capacity and services. \u201cThe most interesting thing that you can start thinking about is the uncoupling of CapEx with capital requirements from Oracle,\u201d Kehring said.<\/p>\n

Oracle, whose market cap is more than $400 billion, has been shadowed by questions about its aggressive capital spending and mounting debt load.\u00a0 The company guided capex of $50 billion for the current fiscal year, a figure that has helped push its total debt position to more than $100 billion. Last month, Oracle raised $30 billion through a one-two punch of bonds and preferred stock, and said its order book was substantially oversubscribed by investors.\u00a0<\/p>\n

For now at least, the company is delivering strong results as the bet plays out.<\/p>\n

At the topline, Oracle on Tuesday reported fiscal third quarter earnings per share up 21% at $1.79, planting it several notches above Wall Street\u2019s expectations of about $1.71 in adjusted earnings per share. The results sent the company\u2019s stock price on an immediate tear in after-hours trading, an \u2018Uno reverse\u2019 on the stock\u2019s roughly 20% tumble so far in 2026.\u00a0<\/p>\n

Oracle executives, including Executive Chairman and co-founder Larry Ellison repeatedly stressed that the company\u2019s enterprise software was not at risk of being displaced by business customers using AI tools to build their own versions of the product. Ellison said Oracle is using AI coding tools to build ecosystem automation platforms for hospitals, financial services firms, and retail operations. <\/p>\n

\u201cThat\u2019s what we\u2019re doing at Oracle,\u201d said Ellison. \u201cThat\u2019s why we think we\u2019re a disruptor. That\u2019s why we think the \u2018Saaspocalpyse\u2019 applies to others, but not to us.\u201d<\/p>\n

A half-trillion dollar backlog<\/p>\n

Cloud infrastructure revenue, Oracle\u2019s fastest growing business unit and a key driver behind its AI ambitions, clocked in at $4.9 billion, with 84% growth year-over-year. The figure was in line with consensus estimates and continues along with Ellison\u2019s vision of competing with Amazon and Microsoft in the cloud market.\u00a0<\/p>\n

Total cloud revenue was $8.9 billion and up 44% year-over-year. Its multi-cloud database revenue slice\u2014the amount Oracle earns from running its database software inside competitors\u2019 clouds\u2014was up 531%. That piece is part of Ellison\u2019s strategic plan of threading Oracle into the ecosystems of Amazon\u2019s AWS, Google Cloud, and Microsoft Azure, rather than prodding customers to move their data into Oracle\u2019s infrastructure.\u00a0<\/p>\n

The company didn\u2019t give specific numbers for multi-cloud revenue, but noted that its remaining performance obligations (RPO), which refers to its backlog of contracted future work\u2014was $553 billion. That figure is evidence of demand outpacing supply, said Magouyrk. He added that Oracle signed more than $29 billion in new contracts since last quarter, in a model in which customers fund the capacity buildout themselves.\u00a0<\/p>\n

\u201cA combination of bring-your-own hardware and upfront customer payments enables us to continue expanding without any negative cash flow,\u201d said co-CEO Clay Magouyrk. He noted that Oracle delivered more than 400 megawatts of capacity to customers in the third quarter, with 90% of it on or ahead of schedule.<\/p>\n

\u201cIt\u2019s unprecedented to be scaling capital into a business so quickly while also increasing profitability,\u201d said Magouyrk during the conference call. \u201cAs our business is going through this hyper-growth phase, that\u2019s the only drag on profitability.\u201d<\/p>\n

Melissa Otto, head of research at S&P Global Visible Alpha, said Oracle\u2019s debt-to-equity ratio stands between 3x and 4x depending on how it\u2019s defined, which is \u201cpretty significant leverage.\u201d<\/p>\n

\u201cThe investment community will want to hear what they\u2019re going to do to ensure that the company remains on the right trajectory given that level of leverage,\u201d said Otto in an interview before the earnings results.\u00a0<\/p>\n

Next quarter, Oracle\u2019s C-suite said it expects revenue to grow 19% to 21% and revenue for the full year is expected to be $67 billion. Fiscal 2027 guidance was raised to $90 billion.<\/p>\n

\u201cHigh-growth companies are willing to take a hit in the near term\u201d in pursuit of an outsized gain over the long-term, said Otto, but investors are looking for evidence along the way that capex is translating into return on invested capital, margin expansion, and revenue growth, she said.\u00a0<\/p>\n

\u201cWhen I look at balance sheets and cash positions of the hyperscalers in the space, they\u2019re very good with the exception of Oracle,\u201d she said.<\/p>\n

#Oracle #called #quarter #years #free #cash #flow #hit #negative #billion<\/p>\n","protected":false},"excerpt":{"rendered":"

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