Shares Surge 27% After Hours — Oracle Lands Major OpenAI Deal, Re-Enters Top Tier of AI Cloud

TradingKey - On Tuesday (U.S. Eastern Time), Oracle (ORCL.US) saw its stock soar over 27% in after-hours trading after announcing a major cloud computing contract with OpenAI, sending its Remaining Performance Obligations (RPO) — revenue from signed contracts not yet delivered — to $455 billion.

Source: Oracle after-hours stock chart, Google Finance

Oracle CEO Safra Catz announced that the company secured multiple “billions of dollars”-sized contracts with major customers during the quarter, driving RPO to surge 359% year-over-year.

Catz described the figure as “staggering,” and projected that more multi-billion-dollar customers will sign on in the coming months, with total RPO expected to surpass $500 billion.

Oracle forecasts that its Oracle Cloud Infrastructure (OCI) business will grow 77% this fiscal year, reaching $18 billion in revenue. Even more striking, the company projects $144 billion in OCI revenue over the next five years, with the majority of this anticipated revenue already reflected in the disclosed RPO.

During the earnings call, Catz emphasized that Oracle is becoming the preferred platform for enterprise AI strategies, thanks to its high-performance, low-cost cloud services.

Jacob Bourne, analyst at eMarketer, noted that enterprises are increasingly seeking “cost-effective AI cloud tools,” and Oracle is precisely meeting that demand.

Additionally, Oracle’s collaboration with the three major cloud providers — Amazon, Google, and Microsoft — has achieved a major breakthrough, with related customer revenue surging 1,529% in the first quarter. Chairman Larry Ellison revealed that Oracle is now building 71 data centers for these three “hyperscaler” partners, with 37 scheduled for delivery in the near term.

Oracle’s strong RPO growth and ambitious revenue outlook demonstrate to investors the robust demand and long-term growth potential of its AI infrastructure business.