TLDR
- Larry Ellison canceled a planned sale of 50 million Oracle stock worth around $7.5 billion, with no explanation given.
- Oracle stock is down 22% year-to-date and 54% from all-time highs, currently trading around $154.
- Barclays raised its price target on ORCL to $252, keeping an Overweight rating, after a record Q1.
- Oracle posted Q1 revenue of $19.3 billion, up 30% year-over-year, with cloud infrastructure revenue jumping 121%.
- Oracle raised full-year revenue guidance to at least $90 billion, a 34% increase from the prior year.
Larry Ellison has canceled a planned sale of 50 million Oracle stock worth around $7.5 billion, the company announced Saturday. No reason was given for the change.
“No Oracle stock was sold under that plan, and he has no other plans to sell any of his Oracle stock,” Oracle said in a statement.
The cancellation comes as ORCL trades around $154, down 22% since the start of the year and 54% from its all-time high.
Barclays Lifts Price Target After Record Quarter
Barclays raised its price target on Oracle to $252 from $250, keeping its Overweight rating. The bank cited Oracle’s Q1 results and what it sees as an improving funding picture.
Oracle posted total revenue of $19.3 billion for the quarter ended August, up 30% year-over-year. It was the first time Q1 revenue grew sequentially, a milestone CFO Hilary Maxson called an important signal.
Cloud infrastructure revenue jumped 121% to $7.4 billion. Cloud apps grew 10%, with Fusion and industry apps growing even faster.
Non-GAAP operating income rose 31% to $8.2 billion. Non-GAAP EPS came in at $1.92, up 30% year-over-year.
One number stood out. Oracle’s remaining performance obligations, a measure of contracted future revenue, grew by $26 billion during the quarter. Much of that came through prepayments or customers bringing their own hardware, meaning Oracle does not need additional cash to fund it.
Balance Sheet Bears Watching
Oracle’s debt load has grown fast. Total debt climbed to $155.9 billion on a trailing twelve-month basis, up from $90.5 billion two years ago. Net debt now sits at $118.9 billion.
Free cash flow was negative $28.7 billion over the trailing twelve months, driven by capital expenditure of $75.7 billion. The company spent $28 billion on CapEx this quarter alone.
Full-year CapEx is expected to land between $90 billion and $95 billion. Cash from operating activities hit a record $46.9 billion over the trailing twelve months, and Maxson said new data center projects convert to strong free cash flow quickly once they ramp up.
On the earnings call, Co-CEO Clay Magouyrk addressed analyst concerns over data center delays in New Mexico and Wisconsin. He stated neither site would affect FY2027 revenue or earnings guidance.
GPU utilization remained at 97.9% during the quarter. Capacity coming up for renewal was resold at a 20% premium to prior contracts.
Oracle raised full-year revenue guidance to at least $90 billion and lifted non-GAAP EPS guidance to $8.10. Q2 revenue growth is expected between 30% and 34%, with cloud revenue growth of 65% to 71%.
The company also announced an Investor Day in October, where management plans to share more detail on margins and long-term guidance.
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