Oracle blows investors away with 22% ‘hyper growth’—but cash flow crunches to negative $24.7 billion

Oracle called the third quarter of fiscal 2026 its best in 15 years with revenue up 22% to $17.2 billion and cloud infrastructure up 84% to $4.9 billion. The market rejoiced, sending the stock up nearly 10% in after-hours trading on Tuesday.

Despite the market’s ebullience, the enterprise software giant is blowing through cash at a steadily rising pace. Just three quarters ago, Oracle’s free cash flow was essentially zero, and this quarter it clocked in at negative $24.7 billion over the trailing 12 months as its capital expenditures rocketed from $21.2 billion in fiscal 2025 to a guided $50 billion this fiscal year as the company forges ahead in its AI data center buildout. 

Chief financial officer Doug Kehring said after the market closed that Oracle would offer up more information about its capital expenditures for fiscal 2027 next quarter.

“I think we’ll get back to everyone at the end of the fiscal year and talk about next year’s capex at that point,” said Kehring in response to a question. However, he flagged that Oracle is working on financing structures where future spending doesn’t come out of Oracle’s pocket but instead can be paid for by customers paying for capacity and services. “The most interesting thing that you can start thinking about is the uncoupling of...