Oracle’s cloud infrastructure saw business more than double in the company latest quarter, proving that its multiyear bet on AI computing power is beginning to be visible in reported sales. In its figures for fiscal first quarter ended August 31 2026 Oracle announced that revenues from the company”s cloud infrastructure increased by 121 percent to 7.4 billion U.S. dollars compared to analysts” forecasts, which averaged around 7.19 billion dollars. The growth was also solid in the cloud total revenues (covering infrastructure and SaaS applications) which increased by 62 percent to 11.61 billion dollars.
Overall, the company”s revenues increased by 30 percent to 19.34 billion dollars. Profit increased sharply with organic adjusted earning of 1.92 dollars per share compared to a forecast near 1.74 dollars and the shares in the company jumped in the early trade. The acceleration is merely another step up a predictable trend, not a ‘quarter-spike’. Infrastructure momentum had already increased for the 12 months to the end of fiscal 2026: 54 percent in quarter one, 66 percent in quarter two, 84 percent in quarter three, and 93 percent in quarter four, when infrastructure sales were $5.
8 bn. Cloud infrastructure sales were $18.1 bn for the year ending 31 May 2026, an increase of 77 percent, and total cloud sales were $34.0 bn, up 39 percent. So the most recent quarter’s 121 percent increase is merely yet another step-up of a very steep curve. The biggest impetus was the demand for the GPU-backed capacity. Oracle has been signing huge, multi-year AI infrastructure deals, many of which involve the customer pre-paying for capacity or providing their own hardware. The company booked over $30 billion of new AI cloud deals in the last quarter alone.
Its remaining performance obligations, representing the amount of contracts signed but not yet recognized as revenues, increased to $664 billion, an increase of $209 billion from the year ago, versus the $638 billion as of the end of 2026. Besides, the management also cited the utilization of capacity GPUs and diverse set of customers instead of a single one. In short, the infrastructure surge is drowning out weakness in traditional software. License and support revenue dropped as customers phased out on-premises products in favor of the cloud.
Cloud applications; Oracle’s SaaS product portfolio, only rose 10 percent to an estimated $4.2 billion. In essence, Oracle’s narrative has changed: data management and enterprise applications aren’t dead, but a significant chunk of the incremental revenue is flowing from the mass provision of compute, storage and network resources.
That comes at a cost. Cloud data centers require massive capital investment, and Oracle is both raising debt and equity to pay for the build-out. Free cash flow has suffered even as bookings and backlog climb. The company forecasted growth between 30% and 34% for its fiscal second-quarter revenues and reaffirmed its goal for at least $90 billion of revenues for fiscal 2024, raising its adjusted earnings target slightly.
Investors are now keeping an eye on whether those utilization rates remain high, whether huge AI deals translate into long-term consumption, and whether infrastructure margins can reach the 30%-40% that the company indicated would characterize the scaled-up business.
For now, the figures are clear. Oracle Cloud Infrastructure is no longer just the rocket ship in the race, but a business that can increase its revenue more than twofold on a year-over-year basis, while still overperforming expectations. The discussion isn’t on whether the demand for AI will be real for Oracle; rather it is if they can afford to build, staff, and fulfill that demand for long term gain.