On June 11, Oracle Shares Plunge Over 10% in pre-market trading. Q4 Beats Were Overshadowed By FY2027 Capex Near $70 Billion And Plans To Raise About $40 Billion Via Debt And Equity, With Free Cash Flow Negative.
Oracle reported Q4 revenue of $19.18 billion, up 21% year-over-year, beating the consensus estimate of $19.10 billion. Adjusted EPS came in at $2.11, topping the $1.96 estimate by 7.65%. Cloud infrastructure (OCI) revenue surged 93% to approximately $5.8 billion, while remaining performance obligations (RPO) soared 363% to $638 billion. However, full-year capital expenditure reached $55.66 billion, up 162% and well above the company's prior $50 billion guidance, resulting in negative free cash flow of $23.7 billion.
The primary catalyst for the sell-off was Oracle's announcement that it expects fiscal 2027 net capital expenditure of $70 billion and plans to raise approximately $400 billion through debt and equity financing, including a previously disclosed $200 billion stock offering. While the company maintained its FY2027 revenue guidance of $90 billion and raised adjusted EPS guidance to $8.05, investors expressed concern that the aggressive spending trajectory and dilutive financing could outpace near-term returns.
