Oracle (ORCL) Stock Explodes 35% as Cloud Business Delivers Massive Quarter

TLDR

Oracle stock surged 35% this week after reporting first quarter fiscal 2026 earnings that exceeded Wall Street expectations The company reported $455 billion in remaining performance obligations, up 359% year over year Oracle projects cloud infrastructure revenue to grow from $10 billion in fiscal 2025 to $18 billion in fiscal 2026 Management forecasts cloud infrastructure revenue reaching $144 billion by fiscal 2030, representing a tenfold increase over five years The stock now trades at 45 times forward earnings after the recent rally

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Oracle Corporation stock exploded higher this week, climbing nearly 35% following earnings results that left Wall Street analysts stunned. The database giant reported first quarter fiscal 2026 earnings that crushed expectations across multiple metrics.

Oracle Corporation (ORCL)

The company posted year-over-year revenue growth of 12% for the quarter ending August 31. However, the number that caught everyone’s attention was Oracle’s remaining performance obligations.

Oracle reported RPOs of $455 billion, up 359% year over year. These represent cloud contracts the company has committed to delivering but has not yet recognized as revenue.

BREAKING: Oracle stock, $ORCL, surges over +23% after reporting earnings with a +359% increase in contracted revenue.

As we continue to reiterate, we are still so early in the AI Revolution. pic.twitter.com/ZuepvHiMZC

— The Kobeissi Letter (@KobeissiLetter) September 9, 2025

The massive RPO figure reflects Oracle’s growing dominance in cloud infrastructure services. The company provides specialized data center capacity tailored to run large language models powering artificial intelligence applications.

Oracle signed four multibillion-dollar deals during the first quarter alone. Management expects several more deals to materialize over the coming months.

Revenue Projections Paint Explosive Growth Picture

The company is now projecting $18 billion of cloud infrastructure revenue in fiscal 2026. This represents a jump from approximately $10 billion in fiscal year 2025.

Management’s long-term projections left analysts even more impressed. Oracle expects cloud infrastructure revenue to climb exponentially over the next four fiscal years.

The company forecasts revenue of $32 billion, $73 billion, $114 billion, and $144 billion respectively through fiscal 2030. D.A. Davidson analyst Gil Luria called these projections “absolutely staggering.”

This growth trajectory would represent a tenfold increase over the next five years. Such expansion would position Oracle as a major beneficiary of the ongoing AI revolution.

The stock surge marked Oracle’s best single day performance since 1992. Jim Cramer highlighted the stock’s recent returns during his show this week.

Cramer noted that investors who bought 10 shares at Oracle’s April low would have seen their $1,200 investment grow to nearly $3,300. This represents a 167% return in less than five months.

Valuation Concerns Emerge After Rally

The dramatic price movement has pushed Oracle’s valuation to elevated levels. The stock now trades at 45 times forward earnings following the recent surge.

This valuation multiple exceeds what Oracle has traded at over the past five years. The premium reflects investor enthusiasm about the company’s AI positioning.

However, some analysts suggest the stock may need a breather after such a substantial run. Making revenue projections four years out presents inherent challenges and execution risks.

Oracle’s cloud infrastructure business continues to benefit from the AI boom. Companies need specialized computing capacity to train and run large language models.

The company’s data centers are specifically designed for these workloads. This positioning has allowed Oracle to command premium pricing for its services.

Oracle stock closed Friday at $307.86 before pulling back in recent trading sessions. The stock currently trades around $292.32 as of the latest market close.

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