Jamie Spencer
Oracle (ORCL) shares fell by approximately 5% on Tuesday morning after the company’s fiscal third-quarter results came in below revenue and earnings-per-share forecasts.
Mixed Earnings Report
While Oracle’s Q3 revenue and EPS missed estimates, the company reported strong bookings growth. Remaining performance obligations (RPO) surged to $130 billion, significantly surpassing the expected $105 billion. This increase was largely driven by robust demand for Oracle Cloud Infrastructure (OCI).
Analyst Insights
Despite concerns over margins and free cash flow, Evercore ISI analyst Kirk Materne highlighted that Oracle’s cloud performance remains solid. He emphasized that the company’s guidance of 15% revenue growth for fiscal 2026, with a projected acceleration to 20% in fiscal 2027 (excluding contributions from Stargate), remains intact.
Morgan Stanley’s Keith Weiss also weighed in, stating that upcoming catalysts—such as Oracle’s OCI day on April 2 and additional details on Stargate accounting from CEO Safra Catz—could help restore investor confidence.
Market Reaction and Future Outlook
Investors remain cautious, as Oracle must prove the long-term value of its growing RPO balance. However, the company’s cloud expansion and upcoming strategic updates could offer a clearer roadmap for sustained growth.
