Oracle Q4 FY26: Revenue Up 21%, RPO Hits $638B, but $70B CapEx Plan Pressures Shares

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What changed

Oracle reported FY2026 Q4 revenue of $19.184B (up 21% YoY), beating the $19.101B consensus estimate by 0.4%. Non-GAAP EPS of $2.11 exceeded the $1.96 estimate by 7.7%. Cloud infrastructure revenue grew 93% YoY and cloud applications grew 10% YoY. The company signed $67B in new AI infrastructure contracts during the quarter, bringing bring-your-own-hardware contracts to $75B total. RPO surged 363% to $638B. GPU utilization reached 97.5%. Management raised FY27 guidance to ~34% revenue growth and $8.05 non-GAAP EPS, while announcing a $70B net CapEx program partially offset by $20-25B in customer pre-payments. New outcome-based and token-bundle pricing models were introduced, with token bundles reaching 33 customers in a limited rollout. Despite the beat and raised guidance, the stock fell 8.5% in the next session (abnormal move of -10.2% vs SPY +1.7%) and drifted 28.5% lower subsequently on volume 2.8x baseline.

Guidance delta

Management raised FY27 guidance to approximately 34% revenue growth and non-GAAP EPS of $8.05, an acceleration from the 21% YoY growth delivered in Q4 FY26. The prior quarter (Q3 FY26) also carried a raised guidance sentiment. The raised outlook is underpinned by the $638B RPO backlog and $67B in quarterly AI infrastructure contract signings, but the $70B net CapEx commitment marks a significant step-up in capital intensity compared to prior periods.

Key takeaways

• Q4 FY26 revenue of $19.2B grew 21% YoY, beating estimates; EPS of $2.11 beat by 7.7%.
• Cloud infrastructure revenue grew 93% YoY, driven by surging AI workload demand.
• RPO surged 363% to $638B, providing exceptional multi-year revenue visibility.
• $67B in new AI infrastructure contracts signed in the quarter; BYOH contracts now total $75B.
• GPU utilization at 97.5% indicates near-full capacity utilization.
• FY27 guidance raised to ~34% revenue growth and $8.05 non-GAAP EPS.

Management priorities

• Scaling AI infrastructure capacity with new data-center sites in Texas, New Mexico, Michigan, and Wisconsin.
• Rolling out AI functionality across the Oracle database and applications stack.
• Expanding token-bundle and outcome-based pricing models from limited rollout to broader customer base.
• Executing the $70B CapEx program while leveraging $20-25B in customer pre-payments to manage cash flow.
• Maintaining high GPU utilization and converting RPO into recognized revenue.