Oracle’s AI Bet: Beat Earnings, Cut 30,000 Jobs, and Stock Still Fell 8%

Oracle reported better-than-expected fourth-quarter revenues, locked in a $300 billion contract with OpenAI, and its stock still dropped 8% after hours. Flat guidance for the coming quarter told investors that the company’s $70 billion AI infrastructure buildout has not yet started paying off.

The company delivered $19.2 billion in Q4 revenue, slightly ahead of the $19.1 billion analysts expected. Oracle also announced plans to spend $70 billion on data centre infrastructure in fiscal 2027. The company cut more than 30,000 jobs in the past quarter, redirecting that payroll cost toward AI infrastructure. However, its stock is down nearly 8% this week.

Oracle Stock Over the Past Week. Source: Google Finance

Oracle’s Data Centre Bet

The $300 billion OpenAI deal gives Oracle’s buildout a foundation that most infrastructure bets lack. Under a five-year arrangement starting in 2027, OpenAI pays Oracle roughly $60 billion annually for cloud computing, giving the company a committed revenue stream to build toward.

Oracle raised $48 billion in debt and equity in fiscal 2026 and plans to raise an additional $40 billion in fiscal 2027 for construction.

Big Tech’s AI infrastructure spending hit $650 billion in 2026, and Oracle’s share of that market has grown sharply since the OpenAI partnership took shape.

Why the Stock Still Fell

Oracle’s near-term guidance came in flat, telling the market that a $300 billion contract doesn’t move the quarterly needle right away. Data centre construction takes time, and investors are weighing whether Oracle can deploy at the scale it has promised before rivals lock in those workloads.

The gap between AI infrastructure commitments and the revenue they are supposed to unlock has hung over the sector for months. Oracle gave that gap a specific number: $70 billion going in, and guidance that doesn’t show it coming back yet.

Oracle has the contract, the spending plan, and the infrastructure roadmap. What investors still need to see is the quarter when that investment begins to translate into visible revenue growth.

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