(Bloomberg) — Oracle Corp. reported a surge in bookings and gave a revenue forecast for the fiscal year beginning in June that topped estimates, fueling confidence that the company is gaining large customers for its cloud infrastructure business.
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“We have now signed cloud agreements with several world leading technology companies including: OpenAI, xAI, Meta, Nvidia and AMD,” Chief Executive Officer Safra Catz said Monday in a statement. “We expect that our huge $130 billion sales backlog will help drive a 15% increase in Oracle’s overall revenue in our next fiscal year.”
Oracle’s efforts the past few years to become a major player in the competitive industry of renting out computing power and storage were validated recently when the company announced a joint venture at the White House with OpenAI and Softbank Group Corp. to spend at least $100 billion to build out data centers for the AI startup. “Solid demand for its cloud infrastructure for generative AI and partnerships with the three largest cloud hyperscalers may catapult Oracle to become the fourth-largest cloud provider,” Anurag Rana, an analyst at Bloomberg Intelligence, wrote in a note before the results were released.
Heading into earnings, many investors expected a rise in cloud infrastructure bookings and capital expenditures due to the joint venture, dubbed Stargate. The project’s first campus is taking shape in Abilene, Texas, where tens of thousands of powerful AI chips from Nvidia Corp. will be delivered in the coming months.
Catz said remaining performance obligations, a measure of bookings, would “continue to grow rapidly — as we look forward to signing our first Stargate contract.”
Investors are closely tracking data center spending across the industry for any signs of a pullback. Chinese upstart DeepSeek released a new open-source AI model that it claims rivals the abilities of US technology at a fraction of the cost, which triggered concerns that companies are investing too much on building data centers.
But Oracle Chairman Larry Ellison said customer demand “is at record levels” and the company is scheduled to double its data center capacity in the calendar year.
The shares gained about 1% in extended trading after closing at $148.79 in New York. The stock has declined 11% this year, in line with a broader stock market rout.
