Oracle (NYSE:ORCL) has underperformed the broader market this year, slipping by over 23.6% since January even as the Nasdaq 100 and S&P 500 have climbed to record highs. This divergence will be in the spotlight this week as investors react to the company’s earnings report.
Oracle to Publish its Earnings on Friday
Larry Ellison’s Oracle has slumped by 56% from its all-time high even as its financial results showed that its business was doing well. The last results revealed that its remaining performance obligations (RPO) jumped by over $85 billion in the quarter to $638 billion.
This RPO growth translated to revenue, which jumped by 19% in the fourth quarter to $19.2 billion, bringing its annual figure to $67.4 billion. Its annual operating income jumped to over $28.9 billion.
The stock has dropped sharply because of the ongoing capital expenditure that has pushed to substantial debt. Most of its capital expenditure are because of its growing role as a big player in the artificial intelligence industry, where it is part of the Project Stargate. It spent $48 billion in capex in the last financial year and plans to spend $70 billion in FY’27, funds that it is raising through equity and debt.
