Software giant Oracle seems to be uncertain about its return on investment (ROI) when it comes to AI. Oracle’s fiscal third-quarter earnings revealed on Monday left much to be desired for investors. Shares of Oracle have reportedly climbed 5% in after-hours trading before sinking 3% as investors digested the missed targets. The stock was still off slightly in pre-market trading Tuesday.
These shortfalls come in the wake of Oracle CTO, Larry Ellison’s belief of “hypergrowth” in its cloud and AI projects.
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While the revenue hasn’t shown desired results, Ellison said customer demand is at record levels, adding “We are on schedule to double our data center capacity this calendar year.”
Oracle has increasingly integrated artificial intelligence (AI) and machine learning (ML) into its cloud and enterprise software offerings. Through its Oracle Cloud Infrastructure (OCI), Oracle provides scalable AI solutions to support businesses in deploying machine learning models and AI applications.
The Oracle Autonomous Database is a prime example, using AI to automate routine database tasks such as patching, tuning, and scaling, reducing the need for manual intervention. Oracle also offers AI-powered tools like Oracle Data Science, Oracle AI, and Oracle Analytics Cloud, which help businesses leverage predictive analytics, natural language processing (NLP), and other AI techniques to optimize operations and make data-driven decisions.
Furthermore, Oracle is committed to ethical AI, focusing on transparency and fairness in its AI implementations. These advancements enable organizations to improve efficiency, reduce costs, and stay competitive in an increasingly data-driven world. Oracle’s AI integration is central to its ongoing transformation in the cloud computing space.
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In the third fiscal quarter, Oracle made $14.13 billion in total revenue, which is a 6% increase from the same time last year. However, this was slightly below analysts’ expected revenue of $14.38 billion. On an adjusted basis, Oracle earned $1.47 per share, which was a little lower than the predicted $1.49 per share.
Oracle CEO Safra Catz highlighted a growth outlook for fiscal 2026 and 2027. “As we bring more capacity online, our revenues will clearly accelerate,” Catz said, referring to the data centers that Oracle continues to build.
Oracle is part of the Stargate Project, a $500 billion AI infrastructure investment initiated by the Trump administration, along with tech giants Meta and OpenAI.