Oracle (ORCL) released its FY2026 Q4 and full-year earnings on June 10, US time. Full-year total revenue was $67.4 billion, up 17% year over year to a record high, and remaining performance obligations (RPO) reached $638 billion. After the earnings release, Oracle’s stock price briefly fell by 5% in after-hours trading. A Bank of America analyst report confirmed that more than half of the $638 billion RPO comes from OpenAI.
Confirmed Financial Figures for FY2026 Q4 and Full Year
According to Oracle’s official earnings report, the confirmed figures for Q4 (February 2025 to May 2026) are as follows:
Q4 Total Revenue: $19.2 billion, up 21% year over year (analysts expected $19.1 billion)
Q4 IaaS Revenue: $5.8 billion, up 93% year over year (market expected 91%)
Q4 Cloud (IaaS+SaaS): $9.9 billion, up 47% year over year, accounting for 50% of total revenue
Q4 Non-GAAP diluted EPS: $2.11 (prior-year same period: $1.70)
FY2026 Full-Year Total Revenue: $67.4 billion, up 17% year over year, a record high
FY2026 Multi-Cloud AI Database Orders: up 325% year over year (revenue up 404% year over year)
$638 Billion RPO: Source Structure Confirmed
RPO at the end of the fourth quarter reached $638 billion, above analysts’ expectation of $590 billion to $600 billion. In its statement, Oracle confirmed that most of the incremental RPO came from large AI contracts. Customers’ arrangements cover two types: prepaying GPU procurement costs, or purchasing GPUs themselves and then having Oracle deploy them. The total contract amount with customers supplying their own GPUs was $75 billion. A Bank of America analyst report noted that more than half of the $638 billion RPO comes from OpenAI.
Capital Expenditure of $5.57 Billion, Free Cash Flow Negative $2.37 Billion, FY2027 Financing of $4.00 Billion
Oracle’s FY2026 capital expenditure was confirmed at $55.7 billion, higher than the company’s prior guidance of $50 billion. Full-year operating cash flow was $32.0 billion (up 54% year over year). After subtracting capital expenditures, free cash flow turned negative at $23.7 billion.
To cover the funding gap, Oracle raised $43.0 billion through debt financing and $5.0 billion through equity financing in FY2026. The company’s statement confirmed that it would not issue new debt in the second half of FY2026.
Oracle also confirmed a plan to raise $40.0 billion again in FY2027, including the previously disclosed $20.0 billion equity financing.
FY2027 Official Guidance: Q1 and Full-Year Confirmed Figures
Oracle’s official FY2027 guidance provided in the earnings report is as follows:
Q1 FY2027 Total Revenue Growth: +27% to +29% (analysts had originally expected below this range)
Q1 FY2027 Non-GAAP EPS: $1.72 to $1.76 (the midpoint is higher than analysts’ expectations)
Q1 FY2027 Cloud Business Growth: +57% to +63%
FY2027 Full-Year Revenue Target: $90 billion (reiterated)
FY2027 Non-GAAP EPS Target: raised to $8.05 (analysts had originally expected $8.01)
Dividend: Oracle announced a quarterly dividend of $0.50 per share, payable on July 24, 2026 to shareholders of record as of July 10.
Frequently Asked Questions
Why did Oracle’s FY2026 free cash flow turn negative?
FY2026 capital expenditure reached $55.7 billion, exceeding the company’s prior guidance of $50 billion. The main reason was expanding AI data centers to support the $638 billion RPO orders. Although full-year operating cash flow reached $32.0 billion, after subtracting $55.7 billion in capital expenditures, free cash flow was confirmed to be negative at $23.7 billion.
More than half of the $638 billion RPO comes from OpenAI—what specific risks does that imply?
According to a Bank of America analyst report, more than half of RPO is concentrated in OpenAI as a single customer. Such a highly concentrated order structure means that if OpenAI itself faces changes in financial conditions or adjusts demand, it will directly affect Oracle’s RPO recognition and future revenue.
What is the specific situation for Oracle’s FY2027 Q1 guidance?
Oracle’s official guidance for Q1 FY2027 calls for total revenue growth of +27% to +29%, and non-GAAP EPS of $1.72 to $1.76. The midpoint of both metrics is above market analysts’ consensus expectations. The full-year non-GAAP EPS target was also raised to $8.05, above analysts’ original expectation of $8.01.
