(Reuters) – Oracle CEO Safra Catz said that the company’s large sales backlog will help drive 15% growth in its revenue next fiscal year, surpassing analysts’ current estimates as it expands its artificial intelligence cloud services.
Analysts expect revenue growth for its fiscal 2026 to be 12.6%, according to data compiled by LSEG.
Shares of the Austin, Texas-based company rose 2% in extended trading.
Oracle, which has been a latecomer to a cloud market dominated by Microsoft and Amazon, has been working to boost the appeal of its cloud services by incorporating AI into them to process large amounts of information.
To support these data-intensive AI services, the company has been strategically expanding its infrastructure with investments in both data centers and semiconductor technology.
“We are on schedule to double our data center capacity this calendar year,” Oracle Chairman Larry Ellison said.
Oracle is part of an AI joint venture called Stargate, along with ChatGPT maker OpenAI, and Softbank, where they have committed up to $500 billion towards developing AI capabilities in the United States.
TD Cowen analysts said in a note last week that Oracle’s data center leasing activity has “significantly picked up in recent months,” with most of it to serve the Stargate project but some for Oracle’s own cloud as well.
Cloud revenue in the third quarter rose 23% to $6.2 billion.
The company reported revenue of $14.13 billion, missing estimates of $14.39 billion.
On an adjusted basis, the company earned $1.47 per share, compared with estimates of $1.49 per share.
(Reporting by Zaheer Kachwala in Bengaluru; Editing by Tasim Zahid)
Rivian Cuts Delivery Outlook as Tariffs Threaten Demand