Oracle's $523 Billion Remaining Performance Obligations Positioning for AI Success
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
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Source: Fool
- Surging Performance Obligations: Oracle's remaining performance obligations (RPO) have reached $523 billion, marking a 438% year-over-year increase, which solidifies the company's foundation for the next phase of AI implementation, positioning it as a potential revenue giant for years to come if executed effectively.
- Strong Customer Support: New commitments from major clients like Meta and Nvidia have driven a 34% year-over-year growth in Oracle's cloud infrastructure business, underscoring its role as a critical infrastructure provider in cloud computing and data, thereby boosting long-term investor confidence.
- Future Revenue Potential: Oracle recorded $16 billion in revenue for Q2 of fiscal 2026, and despite a 5% stock decline over the past year, its stock has surged 200% over the past five years, significantly outperforming the S&P 500's 80% gain, indicating robust long-term growth potential.
- Execution Risks and Competitive Pressure: While Oracle's massive backlog secures future revenue, the substantial costs associated with building data centers and infrastructure introduce execution risks, compounded by fierce competition from AWS, Azure, and Google Cloud, necessitating effective conversion of its backlog to achieve sustained growth.
Analyst Views on ORCL
Wall Street analysts forecast ORCL stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for ORCL is 309.59 USD with a low forecast of 180.00 USD and a high forecast of 400.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
34 Analyst Rating
25 Buy
9 Hold
0 Sell
Moderate Buy
Current: 178.180
Low
180.00
Averages
309.59
High
400.00
Current: 178.180
Low
180.00
Averages
309.59
High
400.00
About ORCL
Oracle Corporation offers integrated suites of applications plus secure, autonomous infrastructure in the Oracle Cloud. The Company operates through three businesses: cloud and license, hardware and service. Its cloud and license business is engaged in the sale, marketing and delivery of its enterprise applications and infrastructure technologies through cloud and on-premise deployment models including its cloud services and license support offerings, and its cloud license and on-premise license offerings. Its hardware business provides infrastructure technologies including Oracle Engineered Systems, servers, storage, industry-specific hardware, operating systems, virtualization, management and other hardware-related software to support diverse IT environments. Its services business provides services to customers and partners to help maximize the performance of their investments in Oracle applications and infrastructure technologies.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
