As Oracle’s cloud growth continues to accelerate even as its revenue base gets significantly larger, the company is also paving the way for continued hypergrowth well into the future as it added a stunning $85 billion to its backlog in Q4, with RPO up 363% to $638 billion.
For Q4, cloud revenue was up 47% to $9.9 billion, highlighted by:
- cloud infrastructure up 93% to $5.8 billion;
- Multicloud AI Database revenue jumped 404%, making it Oracle’s “fastest-growing business ever”;
- cloud-application revenue rose 10% to $4.1 billion; and
- “prepaid and customer-supplied hardware portions of our large AI contracts now total $75 billion,” Oracle said, which “substantially reduces the amount of capital Oracle must raise to build out our AI datacenters.”
As noted above, the Q4 cloud growth rate of 47% extends Oracle’s acceleration for its fiscal year 2026 ended May 31. The combination of this impressive revenue growth plus its other-worldly RPO growth indicates that Oracle continues to win huge chunks of the AI- and cloud-infrastructure market from much-larger competitors Microsoft and AWS.
It also further underscores that while those two companies dominated the early stages of cloud infrastructure, Oracle and Google Cloud are setting a blistering pace in the current chapter —Google Cloud’s Q1 revenue was up 98% to $20 billion, and its backlog doubled to $462 billion.
To quantify that contention with regard to Oracle, here are its quarterly revenue and RPO figures for the four quarters of its fiscal 2026 ended May 31:
| Quarter | Cloud Revenue | RPO |
|---|---|---|
| Q1 | $7.2B, +28% | $455B, +359% |
| Q2 | $8.0B, +34% | $523B, +428% |
| Q3 | $8.9B, +44% | $553B, +325% |
| Q4 | $9.9B, +47% | $638B, +363% |
If we strip out the cloud applications business, here are the cloud infrastructure results for those same four quarters:
| Quarter | Cloud Infrastructure |
|---|---|
| Q1 | $3.3B, +55% |
| Q2 | $4.1B, +68% |
| Q3 | $4.9B, +84% |
| Q4 | $5.8B, +93% |
Final Thought
Each quarter, more and more of those staggering RPO numbers will convert over into revenue. That will surely be reflected in Q1 as Oracle offered guidance for cloud-revenue growth of between 57% and 63%, relative to the 47% it just disclosed for Q4.
So while some financial-model-obsessed Wall St. analysts will still be convulsing themselves over Oracle borrowing money to help fund its massive data center buildout to meet that $638 billion in fully contracted future business, Larry Ellison’s company is proving quite conclusively why I moved it ahead of Microsoft and into the #2 spot on the Cloud Wars Top 10 in early January.
Nicely done, Oracle!
Community Summit North America is the largest independent innovation, education, and training event for Microsoft business applications delivered by Expert Users, Microsoft Leaders, MVPs, and Partners. Register now to attend Community Summit in Nashville, TN from October 11-15.
