Oracle's Cloud Soars, Net Income Nearly Doubles on Ampere Sale

TL;DR

**Oracle's cloud bet is paying off big, and the Ampere sale was a genius move, making this stock a strong buy.**

AI Summary

Oracle Corporation reported a significant increase in net income and revenue for the three and six months ended November 30, 2025. For the three months, net income surged to $6.135 billion, up 94.7% from $3.151 billion in the prior year, while total revenues grew 14.2% to $16.058 billion from $14.059 billion. Cloud revenue was a primary driver, increasing 34.4% to $7.977 billion for the three months. For the six months, net income rose 49.0% to $9.062 billion from $6.080 billion, and total revenues increased 13.2% to $30.983 billion. A key business change was the consummation of the Ampere Acquisition on November 25, 2025, resulting in $4.3 billion cash proceeds and a $2.7 billion realized gain included in non-operating income. Capital expenditures saw a substantial increase to $20.535 billion for the six months, up from $6.273 billion in the prior year, indicating significant investment in infrastructure. The company's remaining performance obligations stood at $523.3 billion as of November 30, 2025, with 10% expected to be recognized as revenue in the next twelve months, signaling strong future revenue visibility. Total assets increased to $204.984 billion from $168.361 billion as of May 31, 2025, driven by a rise in cash and cash equivalents to $19.241 billion and property, plant and equipment, net, to $67.875 billion.

Why It Matters

This strong performance, particularly in cloud revenue and the strategic divestment of Ampere, signals Oracle's successful pivot towards cloud services and effective asset management. For investors, the nearly doubled net income and robust remaining performance obligations provide a bullish outlook, suggesting sustained growth and profitability. Employees might see increased investment in R&D and infrastructure as a sign of job security and future innovation. Customers benefit from Oracle's expanded cloud offerings and continued investment in technology. In the competitive landscape, Oracle's significant capital expenditures in property, plant, and equipment, net, to $67.875 billion, demonstrate its commitment to scaling its cloud infrastructure, directly challenging rivals like Amazon Web Services and Microsoft Azure.

Risk Assessment

Risk Level: medium — While Oracle shows strong growth, its non-current notes payable and other borrowings increased significantly to $99.984 billion from $85.297 billion as of May 31, 2025, indicating higher leverage. Additionally, capital expenditures surged to $20.535 billion for the six months ended November 30, 2025, a substantial increase from $6.273 billion in the prior year, which, while indicative of growth investment, also represents a significant cash outflow and potential operational risk if returns on these investments do not materialize as expected.

Analyst Insight

Investors should consider increasing their position in ORCL, given the strong cloud revenue growth and the strategic financial gains from the Ampere sale. Monitor the company's capital expenditure efficiency and debt management in future filings to ensure these investments translate into sustained profitability and that leverage remains manageable.

Financial Highlights

debt To Equity

3.28

revenue

$16.058B

operating Margin

35.0%

total Assets

$204.984B

total Debt

$108.075B

net Income

$6.135B

eps

$2.17

gross Margin

65.0%

cash Position

$19.241B

revenue Growth

+14.2%

Revenue Breakdown

Key Numbers

• $16.058B — Total revenues (Increased 14.2% for the three months ended November 30, 2025, compared to $14.059 billion in 2024.)
• $6.135B — Net income (Increased 94.7% for the three months ended November 30, 2025, compared to $3.151 billion in 2024.)
• $7.977B — Cloud revenue (Increased 34.4% for the three months ended November 30, 2025, compared to $5.937 billion in 2024.)
• $2.7B — Realized gain (From the Ampere Acquisition, included in non-operating income for the three and six months ended November 30, 2025.)
• $20.535B — Capital expenditures (For the six months ended November 30, 2025, a significant increase from $6.273 billion in 2024.)
• $523.3B — Remaining performance obligations (As of November 30, 2025, indicating strong future revenue visibility.)
• $19.241B — Cash and cash equivalents (As of November 30, 2025, up from $10.786 billion as of May 31, 2025.)
• $99.984B — Non-current notes payable and other borrowings (As of November 30, 2025, up from $85.297 billion as of May 31, 2025.)

Key Players & Entities

• ORACLE CORP (company) — registrant
• Ampere Computing Holdings LLC (company) — equity method investee, acquired by SoftBank Group Corp.
• SoftBank Group Corp. (company) — acquirer of Ampere Computing Holdings LLC
• New York Stock Exchange (regulator) — exchange where ORCL common stock is registered
• SEC (regulator) — Securities and Exchange Commission
• FASB (regulator) — Financial Accounting Standards Board
• Oracle Financial Services Software Limited (company) — majority-owned subsidiary
• Oracle Corporation Japan (company) — majority-owned subsidiary

FAQ

Risk Factors

• Integration of Acquired Businesses [medium — operational]: The company's ability to successfully integrate acquired businesses, such as the Ampere Acquisition, is critical. Failure to achieve the expected benefits from these acquisitions could adversely affect financial results and operational efficiency.
• Intense Competition in Cloud Services [high — market]: The cloud computing market is highly competitive, with significant players investing heavily in infrastructure and services. Oracle faces pressure to maintain its market share and innovate to keep pace with competitors, which could impact pricing and profitability.
• Reliance on Future Revenue Recognition [medium — financial]: A substantial portion of future revenue is tied to remaining performance obligations ($523.3 billion). Delays or cancellations in recognizing this future revenue could materially impact financial performance.
• Data Privacy and Security Regulations [medium — regulatory]: Increasingly stringent data privacy and security regulations globally pose compliance challenges. Non-compliance could result in significant fines and reputational damage, impacting customer trust and business operations.

Industry Context

Oracle operates in the highly competitive enterprise software and cloud computing market. Key trends include the ongoing shift to cloud-based solutions, increasing demand for AI and data analytics capabilities, and consolidation through mergers and acquisitions. Companies are investing heavily in infrastructure to support these demands.

Regulatory Implications

Oracle must navigate a complex web of global regulations, particularly concerning data privacy (e.g., GDPR, CCPA) and cybersecurity. Compliance failures can lead to substantial fines and reputational damage, impacting customer trust and business operations.

What Investors Should Do

1. Monitor cloud revenue growth closely, as it is the primary driver of overall performance and future expansion.
2. Analyze the integration progress and financial impact of the Ampere Acquisition to assess its contribution to long-term value.
3. Evaluate the company's capital expenditure strategy to ensure it aligns with market demands and supports future growth without excessive risk.
4. Assess the company's debt levels and ability to service its obligations, given the increase in non-current borrowings.

Key Dates

• 2025-11-30: Quarter and Six-Month Period End — Reporting period for the condensed consolidated financial statements, showing significant revenue and net income growth.
• 2025-11-25: Consummation of Ampere Acquisition — A significant event contributing $4.3 billion in cash proceeds and a $2.7 billion realized gain to non-operating income.
• 2025-05-31: Previous Fiscal Year End — Baseline for comparison of asset and liability growth, particularly in cash and debt.

Glossary

Remaining Performance Obligations (RPO)

The aggregate amount of the consideration that Oracle expects to receive in exchange for satisfying its performance obligations in the future. This includes unbilled amounts and deferred revenue. (Indicates strong future revenue visibility, with $523.3 billion expected to be recognized as revenue in the next twelve months.)

Accumulated Deficit

The cumulative net losses of a company that have not been offset by net income. A negative number indicates that the company has incurred more losses than profits over its lifetime. (Oracle's accumulated deficit decreased significantly from $(15.481) billion to $(9.355) billion, indicating improved profitability over the period.)

Goodwill

An intangible asset that arises when a company acquires another company for a price greater than the fair value of its identifiable net assets. (Represents a significant portion of Oracle's non-current assets ($62.207 billion), reflecting past acquisitions.)

Noncontrolling Interests

The portion of equity of a subsidiary that is not attributable to the parent company. It represents the ownership interest of outside shareholders in the subsidiary. (A small component of total equity, indicating that Oracle consolidates subsidiaries where it has a controlling interest but does not own 100%.)

Year-Over-Year Comparison

Oracle has demonstrated robust growth compared to the prior year. Total revenues increased by 14.2% for the three months ended November 30, 2025, driven significantly by a 34.4% surge in cloud revenue. Net income saw a substantial jump of 94.7%, reflecting improved profitability. Total assets have grown considerably, supported by a strong increase in cash and cash equivalents and significant investments in property, plant, and equipment, while total debt has also risen.

Key Financial Figures

• $0.01 — ch registered Common Stock, par value $0.01 per share ORCL New York Stock Excha

Filing Documents

• orcl-20251130.htm (10-Q) — 3683KB
• orcl-ex10_16.htm (EX-10.16) — 91KB
• orcl-ex31_01.htm (EX-31.01) — 20KB
• orcl-ex31_02.htm (EX-31.02) — 20KB
• orcl-ex31_03.htm (EX-31.03) — 20KB
• orcl-ex32_01.htm (EX-32.01) — 23KB
• 0001193125-25-315925.txt ( ) — 12258KB
• orcl-20251130.xsd (EX-101.SCH) — 1140KB
• orcl-20251130_htm.xml (XML) — 2504KB

Financial Statements (Unaudited)

Financial Statements (Unaudited) 1 Condensed Consolidated Balance Sheets as of November 30, 2025 and May 31, 2025 1 Condensed Consolidated Statements of Operations for the Three and Six Months Ended November 30, 2025 and 2024 2 Condensed Consolidated Statements of Comprehensive Income for the Three and Six Months Ended November 30, 2025 and 2024 3 Condensed Consolidated Statements of Stockholders' Equity for the Three and Six Months Ended November 30, 2025 and 2024 4 Condensed Consolidated Statements of Cash Flows for the Six Months Ended November 30, 2025 and 2024 5 Notes to Condensed Consolidated Financial Statements 6 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 20 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 38 Item 4.

Controls and Procedures

Controls and Procedures 38 PART II. OTHER INFORMATION 39 Item 1.

Legal Proceedings

Legal Proceedings 39 Item 1A.

Risk Factors

Risk Factors 39 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 39 Item 5. Other Information 40 Item 6. Exhibits 41

Signatures

Signatures 43 Table of Contents

FINANCI AL INFORMATION

PART I. FINANCI AL INFORMATION

Financial St atements (Unaudited)

Item 1. Financial St atements (Unaudited) ORACLE CORPORATION CONDENSED CONSOLIDA TED BALANCE SHEETS As of November 30, 2025 and May 31, 2025 (Unaudited) (in millions, except per share data) November 30, 2025 May 31, 2025 ASSETS Current assets: Cash and cash equivalents $ 19,241 $ 10,786 Marketable securities 525 417 Trade receivables, net of allowances for credit losses of $ 539 and $ 557 as of November 30, 2025 and May 31, 2025, respectively 9,440 8,558 Prepaid expenses and other current assets 5,160 4,818 Total current assets 34,366 24,579 Non-current assets: Property, plant and equipment, net 67,875 43,522 Intangible assets, net 3,760 4,587 Goodwill 62,207 62,207 Deferred tax assets 11,531 11,877 Other non-current assets 25,245 21,589 Total non-current assets 170,618 143,782 Total assets $ 204,984 $ 168,361 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable and other borrowings, current $ 8,091 $ 7,271 Accounts payable 10,140 5,113 Accrued compensation and related benefits 1,947 2,243 Deferred revenues 9,940 9,387 Other current liabilities 7,677 8,629 Total current liabilities 37,795 32,643 Non-current liabilities: Notes payable and other borrowings, non-current 99,984 85,297 Income taxes payable 10,885 10,269 Operating lease liabilities 16,311 11,536 Other non-current liabilities 9,552 7,647 Total non-current liabilities 136,732 114,749 Commitments and contingencies Oracle Corporation stockholders' equity: Preferred stock, $ 0.01 par value—authorized: 1.0 shares; outstanding: none — — Common stock, $ 0.01 par value and additional paid in capital—authorized: 11,000 shares; outstanding: 2,873 shares and 2,807 shares as of November 30, 2025 and May 31, 2025, respectively 40,577 37,107 Accumulated deficit ( 9,355 ) ( 15,481 ) Accumulated other c

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