1. Q2 total revenues reached $16.1 billion, up 14% year-over-year. 2. Cloud revenue surged 34% to $8.0 billion, indicating strong growth. 3. Remaining Performance Obligations rose 438% to $523 billion, demonstrating future revenue potential. 4. Oracle's strategic shift to chip neutrality enhances agility in AI technology adoption. 5. Dividend of $0.50 per share declared, showcasing commitment to return value to shareholders.
FAQ
Why Very Bullish?
The significant growth in cloud revenue, along with a massive increase in Remaining Performance Obligations, suggests a strong market position. Similar past performances have led to positive stock price movements, indicating investor confidence in future earnings.
How important is it?
The strong financial results and strategic changes, particularly in cloud services and AI integration, are highly relevant for ORCL. Investors will likely respond to both immediate performance and long-term strategy, underpinning the importance of this news.
Why Long Term?
The strategic pivot towards AI and chip neutrality positions Oracle well for sustained growth. Historical trends show that companies evolving in line with market technology lead to longer-term stock price gains.
Oracle Reports Strong Financial Results for Fiscal Year 2026 Q2
Oracle Corporation (NYSE: ORCL) has announced impressive financial outcomes for its second quarter of fiscal year 2026, revealing substantial growth across key metrics. With total revenues reaching $16.1 billion, the company reported a 14% increase year-over-year in USD, alongside remarkable advancements in its cloud offerings.
Key Financial Highlights
- Total Remaining Performance Obligations: $523 billion, up 438% in USD
- Total Revenue: $16.1 billion, up 14% in USD
- Cloud Revenue: $8.0 billion, up 34% in USD
- GAAP Earnings per Share: $2.10, up 91% in USD
- Non-GAAP Earnings per Share: $2.26, up 54% in USD
Growth in Cloud Services
Oracle's cloud revenue, which includes Infrastructure as a Service (IaaS) and Software as a Service (SaaS), accounted for a significant portion of the company's earnings, amounting to $8.0 billion, a growth rate of 34% in USD and 33% in constant currency. Notably, the Cloud Infrastructure revenue surged to $4.1 billion, representing a substantial 68% increase.
In contrast, software revenues saw a slight decline of 3% in USD to $5.9 billion, indicating a strategic shift focusing more on cloud solutions.
Operating Income and Cash Flow
Oracle reported a GAAP operating income of $4.7 billion and a non-GAAP operating income of $6.7 billion, reflecting a year-over-year increase of 10% in USD. Additionally, the company's net income for the quarter was $6.1 billion under GAAP and $6.6 billion on a non-GAAP basis, up 57% in USD.
Oracle's operating cash flow over the last twelve months reached $22.3 billion, a 10% increase compared to the previous year.
Comments from Leadership
Doug Kehring, Oracle's Principal Financial Officer, highlighted the strong showing in remaining performance obligations (RPO), stating, “RPO increased by $68 billion in Q2—up 15% sequentially to $523 billion—highlighted by new commitments from Meta, NVIDIA, and others.”
CEO Clay Magouyrk commented on Oracle’s advancements in artificial intelligence, emphasizing the company’s strength in building and operating high-performance cloud data centers, which now number over 211 globally.
Strategic Moves and Future Outlook
Oracle's decision to sell its stake in Ampere, as stated by Chairman and CTO Larry Ellison, reflects a shift towards chip neutrality to maintain flexibility in utilizing various hardware from multiple suppliers. This strategic change aligns with the company’s response to the rapidly evolving AI landscape.
Additionally, Oracle announced a quarterly cash dividend of $0.50 per share, payable on January 23, 2026, to stakeholders of record by January 9, 2026.
Upcoming Earnings Conference Call
Oracle will hold a conference call and webcast to discuss these Q2 results at 4:00 p.m. Central. Interested parties can access the live stream and replay on the Oracle Investor Relations website at www.oracle.com/investor/.