Oracle reported record fiscal first-quarter 2027 revenue of $19.3 billion, representing a 30% year-over-year increase as rapid growth in cloud infrastructure and accelerating demand for AI computing capacity drove the company’s results.
The quarter highlighted the growing importance of Oracle Cloud Infrastructure to the company’s overall business. Total cloud revenue, which includes infrastructure and applications, increased 62% to $11.6 billion. Within that total, cloud infrastructure revenue surged 121% to $7.4 billion, while cloud applications revenue increased 10% to $4.2 billion.
Oracle’s traditional software business continued to reflect customers’ migration toward cloud-based products. Software revenue declined 3% to $5.5 billion, while services revenue increased 5% to $1.4 billion and hardware revenue grew 15% to approximately $800 million.
A major driver of Oracle’s infrastructure growth is demand for AI training and inference services. The company said customer demand for AI cloud capacity continues to grow faster than available supply, underscoring the scale of investment required to expand its data center footprint.
Oracle booked more than $30 billion of additional AI cloud contracts during the first quarter, helping remaining performance obligations increase by $209 billion year over year to $664 billion. The RPO figure represents contracted revenue that has not yet been recognized and provides significant visibility into Oracle’s future business.
The company is expanding infrastructure aggressively to meet that demand. During the quarter, Oracle delivered an additional 850 megawatts of data center capacity.
Since the end of fiscal Q4 2026, Oracle has also delivered more than 300,000 GPUs to AI cloud customers, representing almost three times the capacity delivered in the preceding quarter.
The rapid infrastructure expansion is translating into significantly higher operating results. Oracle reported GAAP operating income of $6.7 billion, up 57% year over year, while non-GAAP operating income increased 31% to $8.2 billion.
GAAP operating margin reached 35%, compared with 29% in the prior-year period, while Oracle’s non-GAAP operating margin was approximately 42%.
GAAP net income available to common shareholders increased 60% to approximately $4.7 billion, while non-GAAP net income available to common shareholders increased 34% to approximately $5.8 billion.
GAAP diluted earnings per share increased 55% to $1.56, compared with $1.01 in the prior-year quarter. Non-GAAP diluted EPS increased 30% to $1.92.
Oracle also generated record first-quarter operating cash flow of $23 billion, up 184%. However, free cash flow was negative $5 billion as the company continued making large investments to expand its cloud infrastructure capacity.
The company is using multiple sources of capital to support that buildout. During fiscal Q1, Oracle completed the sale of $20 billion of common stock through an at-the-market equity program as part of its previously disclosed capital investment plan.
Oracle’s results illustrate the scale at which the company is repositioning itself around AI infrastructure. The combination of triple-digit IaaS growth, rapidly increasing GPU deployments and a $664 billion contracted backlog gives Oracle substantial future revenue opportunities, but also requires significant upfront capital investment in data centers, networking equipment and computing hardware.
The company is also expanding the software layer surrounding its AI infrastructure.
Oracle introduced a new Oracle AI Data Platform designed to automatically create enterprise ontologies, which describe the concepts, relationships and rules contained within a company’s private data and business processes.
Oracle said automatically generating those ontologies can make it easier and less expensive for enterprises to apply advanced AI models to internal information and deploy AI agents capable of automating business processes.
The company is also applying agentic AI to healthcare. Oracle introduced what it describes as an all-new 100% agentic AI Health Care Management and Electronic Health Records system.
The platform includes AI agents designed for individual medical specialties ranging from general medicine to oncology and radiology. Oracle said the specialized agents are intended to assist healthcare professionals with diagnosis and treatment decisions.
Looking ahead, Oracle expects its rapid growth trajectory to continue into the second quarter.
For fiscal Q2 2027, total revenue is expected to increase 30% to 34%, while cloud revenue is projected to grow between 65% and 71% in U.S. dollars.
Oracle expects second-quarter non-GAAP EPS of $1.85 to $1.93, representing growth of approximately 21% to 25% when excluding a one-time investment gain included in the prior-year comparison.
For the full fiscal year, Oracle now expects revenue of at least $90 billion and non-GAAP earnings per share of $8.10.
The board also declared a quarterly cash dividend of $0.50 per share, payable October 23, 2026, to shareholders of record as of October 9.
Taken together, Oracle’s first-quarter results show a company increasingly driven by cloud infrastructure rather than its legacy software business. Cloud now represents roughly 60% of quarterly revenue, while the 121% increase in IaaS revenue, more than $30 billion of new AI cloud contracts and accelerated deployment of GPU capacity point to AI infrastructure as one of Oracle’s most important growth engines.
