Oracle’s stock surged in premarket trading on Friday following a 30% revenue increase in its fiscal first quarter, driven by robust cloud demand and rapid data center expansion.
The software giant reported first-quarter total revenue of $19.35 billion, surpassing LSEG consensus estimates of $19.14 billion, while net income rose 60% year-over-year to $4.7 billion.
Cloud revenue climbed 62% year-over-year to $11.6 billion, fueled by a 121% increase in cloud infrastructure revenue, with cloud application revenue rising 10%.
Oracle shares were up 6.2% in premarket trading, though the stock remains down 21.5% year-to-date.
The company added 850 megawatts of data center capacity during the quarter, secured over $30 billion in new AI cloud contracts, and delivered more than 300,000 GPUs to its AI Cloud customers.
Oracle expects second-quarter revenue growth of 30% to 34%, with cloud revenue increasing 64% to 70%, and projects full-year 2027 fiscal revenue of at least $90 billion.
Beyond its core database software, Oracle has taken on over $100 billion in debt to finance a massive expansion of data centers for AI workloads.
The investment is expected to expand capacity for contracted cloud demand from customers including Nvidia, Meta, OpenAI, AMD and xAI.
A Strong First Quarter
Citi analysts maintained their Buy rating on Friday, stating Oracle met expectations and “cleared the runway” for its upcoming Investor Day.
“Oracle delivered a robust fiscal first quarter that met nearly every expectation and reinforces the bullish narrative ahead of Investor Day,” the analysts stated.
Analysts noted Oracle’s 2027 outlook is “modest” and its management framework is “conservative.”
“Given the magnitude of the fiscal first-quarter outperformance, we anticipate favorable conditions for upward revisions at Investor Day and AI World,” the analysts added.