Oracle Solidifies AI Infrastructure Positioning: Will it Drive Growth?

Oracle Corporation ORCL has reinforced its AI infrastructure positioning through a series of announcements in April and May 2026. On May 1, 2026, Oracle entered into an agreement with the U.S. Department of War to deploy advanced AI capabilities on classified networks, leveraging its 10 cloud regions dedicated to U.S. government customers at DISA IL2 through Top Secret and Special Access Program levels. A May 8, 2026 update detailed the launch of OCI Enterprise AI, with access to models including Grok 4.3 and NVIDIA Nemotron 3 Nano Omni, alongside SoftBank's adoption of OCI for a sovereign cloud platform in Japan. On April 9, 2026, Oracle had introduced Platinum and Diamond-tier availability for Oracle AI Database to support mission-critical workloads. Additional April announcements included expanded multicloud connectivity with AWS and a deeper Google Cloud partnership through the Oracle AI Database Agent for Gemini Enterprise.These developments build on third-quarter fiscal 2026 results released on March 10, 2026. Remaining Performance Obligations (RPO) at the end of the quarter were $553 billion, up 325% year over year and $29 billion higher sequentially, with most of the increase tied to large-scale AI contracts. Cloud revenues rose 44% to $8.9 billion, Cloud Infrastructure (IaaS) revenues jumped 84% to $4.9 billion and multicloud database revenues surged 531%. Total revenues climbed 22% to $17.2 billion, while non-GAAP EPS rose 21% to $1.79.The expansion remains capital-intensive. Oracle reaffirmed fiscal 2026 capital expenditure guidance of $50 billion against revenue guidance of $67 billion and raised $30 billion in February through investment-grade bonds and mandatory convertible preferred stock. Customer prepayments and customer-supplied GPUs are absorbing much of the new build cost. Oracle has lifted fiscal 2027 revenue guidance to $90 billion, with fourth-quarter fiscal 2026 cloud revenues expected to grow 46-50%.Peer Comparison: Microsoft and Alphabet's AI Infrastructure PushMicrosoft MSFT and Alphabet GOOGL are scaling AI infrastructure at comparable intensity. Microsoft reported 40% Azure and other cloud services growth in its fiscal third quarter ended March 31, 2026, with the company guiding roughly $190 billion in calendar 2026 capital expenditure. Alphabet's Google Cloud revenues jumped 63% year over year to $20 billion in first-quarter 2026, while cloud backlog nearly doubled sequentially to more than $460 billion. Alphabet raised its 2026 capex range to $180-$190 billion, signaling Google Cloud capacity remains demand-constrained. Compared with Oracle's $553 billion RPO, Microsoft and Alphabet operate at materially larger absolute cloud revenue scales.ORCL’s Price Performance, Valuation & EstimatesShares of Oracle have lost 14.6% in the past six-month period, underperforming the Zacks Computer and Technology sector’s appreciation of 17.5%.ORCL’s 6-Month Price PerformanceImage Source: Zacks Investment ResearchFrom a valuation standpoint, ORCL stock is currently trading at a premium with a trailing 12-month Price/Earnings ratio of 31.51x, which is higher than the Zacks Computer - Software industry average of 25.47x. Oracle carries a Value Score of D.ORCL’s ValuationImage Source: Zacks Investment ResearchThe Zacks Consensus Estimate for ORCL’s fiscal 2026 earnings is pegged at $7.46 per share, marking an upward revision of 0.5% over the past 30 days. The earnings figure suggests 23.71% growth over the figure reported in fiscal 2025.Oracle Corporation Price and Consensus Oracle Corporation price-consensus-chart | Oracle Corporation QuoteORCL stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.Free: See Our Top Stock And 4 Runners UpThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks