Overview
- Oracle’s rapid AI and cloud buildout has turned free cash flow deeply negative, with capex disclosed as high as $48.3 billion.
- Management says bring-your-own-hardware paired with upfront customer payments allows continued expansion without additional negative cash outlays for Oracle.
- The latest quarter delivered $17.2 billion in revenue, up 22% year over year, with cloud revenue up 44% to $8.9 billion and OCI up 84% to $4.9 billion.
- Oracle reported remaining performance obligations of $553 billion, which Guggenheim notes were up 325% year over year.
- Guggenheim reiterated a Buy rating with a $400 price target and views the current spend as setting up a potential free-cash-flow inflection in fiscal 2029–2030.