Oracle Corporation ORCL · Stock Open Oracle Corporation in new tab

Oracle’s stock fell 7.0% after earnings, signaling investor concern over heavy infrastructure investment and near-term margin and cash-flow pressure despite rapid cloud infrastructure growth. Gross margin declined as data-center capacity ramped, while quarterly free cash flow was negative $5 billion amid $28 billion of CapEx.

• Q1 revenue rose 30% year over year to a record $19.3 billion, with cloud infrastructure revenue up 121% to $7.4 billion.
• Non-GAAP operating income increased 31% to $8.2 billion and EPS rose 30% to $1.92; operating margin remained approximately flat at 42%.
• Gross margin declined as Oracle accelerated data-center investment and infrastructure revenue growth, although lower operating costs offset the impact at the operating-margin level.
• CapEx reached $28 billion, producing negative free cash flow of $5 billion; management expects full-year CapEx of $90 billion–$95 billion and net cash CapEx of no more than $70 billion.
• Remaining performance obligations increased $26 billion from Q4, but management said most new contracts will not contribute to revenue or require incremental capital until fiscal 2028 or later.