#Oracle Reports Strong Q3 Revenue Growth
Oracle Corporation (NYSE: ORCL) reported total revenue of $17.2 billion for its fiscal third quarter ended February 28, 2026, a 22% increase from the same period a year earlier, according to results released March 10, 2026. Cloud revenue reached $8.9 billion, up 44% year-over-year in U.S. dollar terms.
The quarter marks a notable shift in Oracle's revenue mix. Cloud now accounts for 52% of total quarterly revenue, up from 44% in the prior-year period. Software revenue, which includes license and support contracts, totaled $6.1 billion, a 3% increase in USD though down 1% in constant currency, reflecting continued migration pressure on legacy licensing.
#Cloud Infrastructure Drives Quarterly Results
Cloud infrastructure revenue, which covers the company's IaaS segment, totaled $4.9 billion, up 84% in USD and 81% in constant currency. Oracle attributed part of that growth to large-scale AI-related contracts. Multicloud database revenue rose 531% in USD, though the company did not disclose the absolute revenue figure for that segment. Cloud application revenue reached $4.0 billion, up 13% in USD.
GAAP diluted earnings per share came in at $1.27, up 24% from $1.02 in the year-ago period. On a non-GAAP basis, which excludes stock-based compensation, amortization of intangibles, and restructuring charges, diluted EPS was $1.79, up 21%. GAAP net income was $3.7 billion. Non-GAAP net income was $5.2 billion.
Remaining Performance Obligations, a forward revenue indicator representing contracted but unrecognized revenue, ended the quarter at $553 billion, up 325% year-over-year and up $29 billion sequentially. The increase reflects large multi-year AI infrastructure contracts, some of which involve customers prepaying for GPU capacity or supplying hardware to Oracle data centers. Oracle stated that the increase was driven primarily by large AI contracts, and said it does not expect to require incremental capital to fulfill those commitments, as most associated equipment is either funded through customer prepayments or supplied directly by customers.
#Capital Structure and Financing Activity
In February 2026, Oracle announced plans to raise up to $50 billion through a combination of debt and equity. The company subsequently raised $30 billion via investment-grade bonds and mandatory convertible preferred stock. Oracle stated it does not intend to issue additional bonds in calendar year 2026. As of the filing date, the at-the-market equity component had not yet been initiated. Total notes payable, including current and non-current portions, stood at approximately $134.6 billion at quarter end, compared to $92.6 billion at the close of fiscal year 2025.
Capital expenditures for the nine months ended February 28, 2026 totaled $39.2 billion, more than three times the $12.1 billion spent in the comparable prior-year period, reflecting ongoing data center buildout. On a trailing four-quarter basis, free cash flow was negative $24.7 billion, compared to positive $5.8 billion a year earlier.
#Workforce and Product Development
Oracle disclosed that it has been restructuring product development teams in response to AI-assisted code generation. The company said these tools are enabling software development with smaller teams, and that the restructuring is intended to reduce costs and expand the number of industry-specific SaaS applications. Restructuring charges totaled $153 million in Q3, up from $63 million in the year-ago quarter, and $961 million for the nine-month period.
#Industry Context
Oracle competes in the cloud infrastructure market alongside Amazon Web Services, Microsoft Azure, and Google Cloud. Enterprise cloud spending has accelerated across the sector as organizations expand AI workloads. Oracle has positioned its OCI platform as an alternative for AI training and inference, citing cost and performance characteristics. The company's multicloud database strategy, which allows customers to run Oracle databases within competing cloud environments, has been a stated growth driver.
#Forward Guidance
For Q4 fiscal 2026, Oracle said it expects total revenue growth of 19% to 21% in USD, and cloud revenue growth of 46% to 50% in USD. Non-GAAP EPS guidance for Q4 is $1.96 to $2.00. For full fiscal year 2026, the company maintained its revenue guidance of $67 billion with capital expenditures of $50 billion. For fiscal year 2027, Oracle raised its total revenue guidance to $90 billion.
The board declared a quarterly cash dividend of $0.50 per share, payable April 24, 2026 to shareholders of record as of April 9, 2026.
Forward-looking statements, including revenue and earnings guidance and expectations regarding AI contract fulfillment, are subject to material risks and uncertainties. Oracle cited risks including product development execution, GPU supply chain constraints, datacenter capacity management, cybersecurity, government contracting volatility, and changes in economic and regulatory conditions. Additional risk factors are detailed in Oracle's most recent Form 10-K and Form 10-Q filings with the SEC.