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Oracle Reports Record $638 Billion AI Contract Backlog as It Plans Massive Data‑Center Build

The backlog signals multi‑year AI revenue and forces heavy near‑term spending, large financing, and closer scrutiny of cash flow and execution risk.

Overview

  • Oracle reported fiscal Q4 results that beat estimates and were announced on June 10, with revenue of $19.2 billion and adjusted EPS of $2.11.
  • Remaining performance obligations reached $638 billion, which management says will convert roughly 12% in the next 12 months and another 34% over months 13–36, providing multi‑year revenue visibility.
  • Oracle disclosed $67 billion of new AI infrastructure contracts in the quarter and said $75 billion of large AI deals are prepaid or bring‑your‑own‑hardware (BYOH), which shifts some capital burden to customers.
  • Management plans roughly $70 billion of net capital spending for fiscal 2027 and intends to raise about $40 billion of debt and equity, including a $20 billion at‑the‑market equity program.
  • Operational metrics such as 97.5% global GPU utilization and strong renewals show demand, but analysts warn the buildout and heavy near‑term spending create cash‑flow, leverage, customer‑concentration, and execution risks.