01—Abstract
Summary
Summary of the 8-K filed March 10, 2026. Cited figures are marked; the original filing is the authoritative source.
Oracle reported fiscal Q3 2026 (quarter ended February 28, 2026) with revenue of $17.2 billiona, up 22% in USD and 18% in constant currency, and cloud revenue of $8.9 billion, up 44%.
Cloud infrastructure (IaaS) grew 84% to $4.9 billionb. GAAP diluted EPS was $1.27 (up 24%) and non-GAAP EPS was $1.79 (up 21%). Remaining performance obligations (RPO) reached $553 billion, up 325% year over year and $29 billion sequentially, mostly from large-scale AI contracts.
Management says it expects that growth to be funded through customer prepayments or customer-supplied GPUs, so it does not expect to raise incremental funds for those contracts. Profitability and cash flow are the main tension in the report. GAAP operating income was $5.5 billionc, and interest expense rose 32% to $1.18 billion.
Trailing-four-quarter free cash flow was deeply negative at about -$24.7 billiond, because capital expenditures were about $48.3 billion against operating cash flow of $23.5 billion. Oracle raised $30 billion of its planned up-to-$50 billion financing through investment-grade bonds and mandatory convertible preferred stock, and says it has not yet started the at-the-market equity portion. Total notes payable and borrowings were roughly $134.6 billion at February 28, 2026, versus about $92.6 billion at May 31, 2025.
Guidance raises the outlook for FY2027, with total revenue now expected at $90 billion. FY2026 revenue guidance of $67 billion and capital expenditures of $50 billion is unchanged.
Q4 FY2026 guidance calls for total revenue growth of 19% to 21% in USD and non-GAAP EPS of $1.96 to $2.00 in USD. The board also declared a $0.50 quarterly common dividend (payable April 24, 2026) and a $1,263.89 dividend per share on the Mandatory Convertible Preferred Stock (payable April 15, 2026).
02—Key points
Key Highlights
- RPO of $553 billion, up 325% year over year and up $29 billion sequentially, driven mainly by large-scale AI contracts
- Total revenue of $17.2 billion, up 22% in USD (18% constant currency); cloud revenue of $8.9 billion, up 44%
- Cloud infrastructure revenue of $4.9 billion, up 84% in USD, the fastest-growing line in the report
- GAAP EPS of $1.27 (up 24%) and non-GAAP EPS of $1.79 (up 21%); GAAP operating income of $5.5 billion
- Trailing-four-quarter free cash flow of about -$24.7 billion as capex of about $48.3 billion outpaced operating cash flow of $23.5 billion
- Raised FY2027 revenue guidance to $90 billion; FY2026 guidance unchanged at $67 billion revenue and $50 billion capex
- Raised $30 billion of a planned up-to-$50 billion financing; no additional bonds planned in calendar 2026, and the at-the-market equity program has not started
03—Questions
Frequently Asked Questions
How strong was Oracle's growth in fiscal Q3 2026?
Total revenue grew 22% in USD to $17.2 billion, and cloud revenue grew 44% to $8.9 billion. Cloud infrastructure revenue rose 84% to $4.9 billion. Management said this was the first quarter in over 15 years in which organic total revenue and non-GAAP EPS both grew 20% or more in USD.
What does the $553 billion in RPO mean for investors?
RPO is contracted revenue not yet recognized. The $553 billion figure, up 325% year over year, reflects large AI contracts. Oracle says most of the equipment for these contracts is funded through customer prepayments or supplied by customers, so it does not expect to raise incremental funds to support them. Conversion timing and customer concentration are not disclosed in this filing.
Is Oracle's balance sheet and cash flow under pressure?
Yes, on the numbers in this filing. Capital expenditures are rising sharply, trailing free cash flow is about -$24.7 billion, and total borrowings are roughly $134.6 billion. Interest expense rose 32% to $1.18 billion in the quarter. Oracle has raised $30 billion of its planned up-to-$50 billion financing, and the remaining equity portion has not yet started.
What is the updated guidance?
For Q4 FY2026, Oracle expects total revenue growth of 19% to 21% in USD and non-GAAP EPS of $1.96 to $2.00. For FY2026 it expects revenue of $67 billion and capex of $50 billion, both unchanged. For FY2027 it raised revenue guidance to $90 billion.
What are the dividend details?
The board declared a $0.50 per share quarterly dividend on common stock, payable April 24, 2026 to holders of record on April 9, 2026. It also declared $1,263.89 per share on the Mandatory Convertible Preferred Stock, payable April 15, 2026 to holders of record on April 1, 2026.
04—Continue