Enterprise

Oracle posts record $67.4B year and a $638B AI backlog — then warns of $40B more financing in FY27

Oracle beat Q4 estimates with 21% revenue growth and 93% IaaS growth, but shares slid after the company disclosed $55.7B in FY26 capex and another $40B raise ahead to fund its AI data-center buildout.

By Asher Glick · Enterprise software desk · 2026-06-10 · 3 min read

Photo: Unsplash / Taylor Vick — Rows of server racks inside a hyperscale data center

Oracle closed fiscal 2026 with a $638 billion backlog, a record $67.4 billion in annual revenue, and a stock that fell roughly 9% in after-hours trading anyway. The June 10 report after the bell didn’t miss; it landed exactly where the AI-infrastructure trade is most uncomfortable, at the seam between booked demand and the cash required to deliver it.

The headline numbers were unambiguous. Q4 revenue rose 21% to $19.2 billion, total cloud revenue jumped 47% to $9.9 billion, and Oracle Cloud Infrastructure grew 93% to $5.8 billion. Full-year revenue climbed 17%. Remaining Performance Obligations, the contracted-but-undelivered work that has become the market’s preferred AI demand proxy, surged 363% year-over-year and added $85 billion sequentially from Q3’s $553 billion. By any conventional read, this is a company whose order book is outrunning its industry.

The discomfort sits below the revenue line. Operating cash flow hit a record $32.0 billion, up 54%, but free cash flow was negative $23.7 billion because capex landed at $55.66 billion, up 162% year-over-year. Depreciation nearly doubled to $7.62 billion. New CFO Hilary Maxson, hired during the quarter from Schneider Electric, told the call that net cash capex in fiscal 2027 will run around $70 billion before $20–$25 billion in customer prepayments and timing effects. To fund it, Oracle plans to raise roughly $40 billion in FY2027 through debt and equity, including a previously announced $20 billion at-the-market issuance. That follows $43 billion in debt and $5 billion in equity raised in FY2026, against a Q3 debt load already at $162 billion.

CEO Clay Magouyrk framed the physical scale: Oracle is bringing online almost one gigawatt of computing power this quarter, roughly the total it added across all of fiscal 2026.

Guidance was firmly above consensus, with Q1 FY2027 growth pegged at 27%–29% and non-GAAP EPS at $1.72–$1.76 against an LSEG consensus of $1.68. Even so, Mizuho had modeled FY2027 growth nearer 34%. The compression between booked demand and the financing required to serve it’s now the entire Oracle story, and increasingly the AI-credit story too. Investors didn’t sell the backlog. They sold the capital stack.

Sources