Oracle closed Thursday at $152.94, down $8.69, or 5.38% — one of the worst single-day showings among large-cap technology stocks in a session where almost everything tied to artificial intelligence was sold. Then the company reported fiscal first-quarter results, and by 4:28 p.m. Eastern the stock was quoted at $163.57 in after-hours trading, up 6.95%.
The same shares, the same day, a roughly 12-point round trip. Friday's open will decide which of the two prices was right.
What Oracle actually reported
The numbers cleared the bar Wall Street had set, and cleared it by more than the usual rounding:
Adjusted earnings of $1.92 a share, against a $1.74 consensus — a beat of 18 cents, or about 10%.
Revenue of $19.35 billion, versus $19.13 billion expected, and roughly 28% above the year-ago quarter.
Cloud infrastructure revenue more than doubled year over year, according to CNBC's report on the release.
Company guidance going in had called for total revenue growth of 27% to 29%, cloud revenue growth of 58% to 64%, and non-GAAP earnings of $1.72 to $1.76.
Oracle came into the print carrying the largest contracted backlog in enterprise software. Remaining performance obligations stood at $638 billion at the end of fiscal 2026, up $85 billion sequentially and 363% year over year, driven by large-scale AI contracts — including an arrangement with OpenAI reported at roughly $300 billion over several years. The prepaid and customer-supplied hardware portion of those contracts totals $75 billion, which reduces how much capital Oracle has to raise itself.
It still has to raise a great deal. In fiscal 2026 the company took on $43 billion in debt financing and $5 billion in equity. For fiscal 2027 it expects to raise about $40 billion more, including a previously announced $20 billion at-the-market equity issuance, against a capital expenditure target near $70 billion. Free cash flow for fiscal 2026 was negative $23.7 billion.
That is the trade investors are being asked to make: contracted revenue measured in hundreds of billions, financed by borrowing measured in tens of billions, delivered through the physical plant that has to be built first. Thursday's daytime selling said the market is tired of funding it. Thursday's after-hours buying said the market will fund it as long as the revenue keeps showing up on schedule.
Oracle shares closed the regular session about 55% below their 52-week high of $345.72 and roughly 16% lower on the year before the report.
Adobe beat too, and the stock did not move
Adobe reported the same evening and the reaction was almost the mirror image.
Revenue hit a record $6.76 billion, up 13% year over year and above the $6.69 billion consensus. Non-GAAP earnings came in at $6.13 a share, ahead of the $6.08 estimate. Total annualized recurring revenue exited the quarter at $27.50 billion. AI-first ARR grew more than 150% year over year. The company said it crossed one billion monthly active users across its creativity and productivity products, generated record third-quarter operating cash flow of $2.52 billion, and repurchased about 9.5 million shares.
Adobe also raised the year: full-year revenue guidance moved to $26.58 billion to $26.63 billion from $26.51 billion, and earnings to $24.45 to $24.50 from $24.36. Fourth-quarter guidance is $6.80 billion to $6.85 billion in revenue and $6.30 to $6.35 in earnings — revenue slightly below the $6.84 billion analysts modeled, earnings essentially in line.
The stock closed the regular session at $248.83, down 2.37%, and was quoted at $246.44 after hours, down another 0.96%. A record quarter, a raised outlook, and no bid. Interim CFO Steve Day framed it as "double-digit revenue and EPS growth"; the market seems to be waiting for incoming chief executive Anil Chakravarthy, who takes over December 1, to say what the freemium strategy does to ARR in fiscal 2027.
Where the tape closed
Oil and rates ran the session, as they have all week.
S&P 500: 7,591.70, down 44.66 points, or 0.58%
Dow Jones Industrial Average: 52,064.10, down 316.56 points, or 0.60%
Nasdaq Composite: 26,081.73, down 171.62 points, or 0.65%
CBOE Volatility Index: 17.84, up 8.38%
10-year Treasury: 4.963%, up 12.3 basis points — its highest since 2023
Brent crude traded above $105 a barrel Thursday, its first time there since late May, as the war with Iran continued to disrupt shipping near the Strait of Hormuz.
August producer prices, released before the open, showed why that matters. The Producer Price Index rose 0.4% month over month and 5.4% year over year, up from 4.8% in July and matching the consensus forecast. Goods prices jumped 1.1% after falling 0.4% in July, and more than three-fourths of that came from a 4.2% monthly rise in energy. Services prices rose just 0.1%, the slowest in three months. Core PPI excluding food, energy and trade services rose 0.3% monthly and 4.7% annually. Fed funds futures moved to roughly a 70% probability of a 25-basis-point hike next week, from 64% just before the release.
Elsewhere: homebuilders sold off as the average 30-year fixed mortgage rate crossed 7%, with the SPDR S&P Homebuilders ETF down more than 2%. Micron closed at $977.41, down 4.90%, and Nvidia at $218.36, down 2.26%. Elevance Health rose 5.41% to $416.54 after its finance chief said third-quarter earnings are tracking ahead of plan and reaffirmed 2026 guidance of at least $27 a share excluding one-time items. Biohaven fell about 16% after the FDA placed a partial clinical hold on an experimental epilepsy drug over a rodent-study safety signal. Macy's dropped 4.70% to $20.50.
What lands next
August CPI arrives Friday at 8:30 a.m. Eastern — headline expected at 0.4% monthly and 3.4% annually, core at 0.4% and 2.4%. It is the last inflation reading the Federal Open Market Committee sees before its September 15–16 meeting under Chair Kevin Warsh, who said at Jackson Hole that this summer's numbers "do not tell me that underlying trends have meaningfully improved." The preliminary University of Michigan sentiment survey follows. As we noted when the August payroll data came in with a hole in it, the data behind these odds is noisier than the odds themselves suggest.
Kroger reports before the open, with analysts looking for $1.06 a share on $34.65 billion in revenue, growth of 1.9% and 2.2%. The stock closed Thursday at $56.95, up 0.90%, against a mean analyst target of $69.77 split between 11 buys and 13 holds. UBS analyst Michael Lasser wrote that the company "still needs to communicate a more concrete transformation plan" under new chief executive Greg Foran, and warned that "tariff refunds could be downward pressure on the food retail profit pool." Watch identical sales excluding fuel, which management guided to about 1%.
And Apple's preorder window for the iPhone Duo opens October 16, five weeks after a launch its own analysts called the risk.
This article is for informational and educational purposes only and does not constitute investment advice or a recommendation to buy or sell any security.
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