Oracle Nears $600B Valuation as AI Backlog Hits $553B Ahead of High-Stakes Earnings Test

Oracle shares have become one of Wall Street’s biggest AI winners. But after a sharp pullback and a nearly 60% rally from this year’s lows, investors are now focused on a single question: Can Oracle justify its rapidly rising valuation when it reports earnings on June 10?

The software giant has emerged as one of the biggest beneficiaries of the AI infrastructure race. Massive cloud contracts from OpenAI, Meta, and xAI have transformed Oracle from a traditional database company into a major AI cloud provider competing with Amazon, Microsoft, and Google.

However, recent volatility across the technology sector has raised the stakes for the upcoming earnings report.

Oracle Earnings Could Become a Key AI Market Catalyst

Oracle will report fiscal fourth-quarter results after the market closes on June 10.

Wall Street expects:

• EPS: $1.96, up 15.3% year-over-year
• Revenue: Approximately $19.1 billion
• Cloud growth: Expected to remain the primary driver
• AI infrastructure demand: Under intense scrutiny

The report arrives during a difficult period for technology stocks.

Broadcom recently delivered strong earnings but disappointed investors with guidance that failed to exceed lofty expectations. The result triggered a broad semiconductor selloff and renewed concerns about whether AI spending can maintain its current pace.

Oracle now faces a similar challenge.

Investors will be watching:

• Cloud infrastructure growth
• Remaining Performance Obligations (RPO)
• AI-related contract wins
• Data center expansion plans
• Fiscal 2026 and 2027 guidance
• Commentary on OpenAI, Meta, and xAI demand

Oracle’s AI Business Is Expanding Rapidly

Oracle’s recent financial performance illustrates why investors have become increasingly bullish.

In its most recent quarter:

• Revenue increased 24% to $17.2 billion
• Cloud revenue jumped 44% to $8.9 billion
• Oracle Cloud Infrastructure (OCI) surged 84% to $4.9 billion
• Cloud applications rose 13% to $4 billion
• Remaining Performance Obligations reached $553 billion, up 325% year-over-year

That backlog figure has become one of the most closely watched metrics in enterprise software.

Much of the growth has been linked to AI-related contracts with major customers including OpenAI, Meta, and xAI.

Management has also raised long-term targets:

• FY2027 revenue target: $90 billion
• OCI capacity investment: $45 billion-$50 billion
• Annual revenue expected to approach $88 billion next fiscal year

Several analysts now argue Oracle could eventually join the trillion-dollar market cap club if AI demand remains strong.

Balance Sheet Expansion Raises Questions

The growth story is attracting investors, but it comes with costs.

Oracle has aggressively expanded infrastructure spending to meet AI demand.

The company recently raised billions through debt and equity financing.

Long-term debt climbed to approximately $124 billion, up from $85 billion a year earlier.

The strategy resembles the capital-intensive expansion currently underway across the AI industry.

Supporters argue the investments are necessary to capture a once-in-a-generation AI opportunity.

Critics warn that execution risks increase significantly when growth depends heavily on a small number of large AI customers.

ORCL Technical Analysis: Uptrend Faces Its First Major Test

Despite the recent correction, Oracle’s broader technical structure remains constructive.

The stock pulled back sharply from its recent peak near $250 but continues trading above most key trend indicators.

Key Technical Signals

The recent decline pushed Oracle below its short-term moving averages, but the stock remains comfortably above medium- and long-term trend support.

The longer-term bullish structure remains intact.

RSI and MACD

RSI: 55.61

• Momentum has cooled significantly
• No longer overbought
• Suggests consolidation after a strong rally

MACD: 14.39

• Remains positive
• Bullish trend remains intact
• No major reversal signal has emerged

The combination suggests Oracle may be digesting recent gains ahead of a potentially market-moving earnings report.

Key Support and Resistance Levels

Holding above the $205-$210 region would suggest buyers remain active despite recent volatility. A strong earnings report could place the $250 level back into focus.

Analysts Continue Raising Targets

Wall Street remains broadly bullish on Oracle.

Recent analyst targets include:

• Jefferies: $320
• Cantor Fitzgerald: $284
• Some bullish forecasts suggest Oracle could eventually approach $379 if earnings growth and valuation multiples continue expanding.

Consensus estimates project earnings per share growing from approximately $7.42 in fiscal 2026 to $10.82 by fiscal 2028.

That implies annualized earnings growth exceeding 20%.

Long-Term Outlook: Oracle Is Becoming an AI Infrastructure Giant

Oracle’s investment case increasingly revolves around AI rather than traditional enterprise software.

The company’s cloud infrastructure business is growing faster than nearly every major software peer. Its partnerships with OpenAI, Meta, Nvidia, and other AI leaders have positioned Oracle at the center of one of the largest technology spending cycles in history.

The key question is whether Oracle can continue converting its massive backlog into revenue while expanding infrastructure fast enough to meet demand.

For now, investors appear willing to bet that AI spending remains strong.

The June 10 earnings report could determine whether Oracle’s next move is driven by fundamentals—or by the same valuation concerns that recently triggered sharp declines across the broader AI sector.