Five years ago, Oracle was the vendor your IT department renewed every January without a second thought, the database nobody got fired for buying. In the past year it has raised tens of billions of dollars in debt and equity, signed a compute contract with OpenAI that press reports value at around 300 billion dollars, and turned a 48 year old enterprise software business into one of the most leveraged bets on the AI buildout trading on Wall Street. That's why we built Winvesta Crisps - to decode what's actually driving the companies you own, in plain language, before the consensus catches up. 60,000+ investors from all over India are already in. What about you?
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Most investors still think of Oracle as the company that sells databases to banks, airlines and tax departments, a legacy enterprise vendor that grows in the single digits and gets owned for its dividend, not its upside. That framing is accurate and dangerously incomplete. Oracle has spent the past eighteen months turning its balance sheet into the financing arm of the AI buildout, borrowing tens of billions of dollars to build data centres that it then rents out, with OpenAI alone reportedly on the hook for a five year contract worth roughly 300 billion dollars. The database business still exists, and still throws off real cash. It is no longer the business that moves the stock.
🏭 What Oracle actually is today
Oracle was founded in 1977 by Larry Ellison on the idea of a commercial relational database, and for four decades that database, plus the enterprise applications Oracle bolted on through acquisitions such as PeopleSoft, Siebel and NetSuite, was the whole story. Fortune 500 companies ran payroll, inventory and financial reporting on Oracle software because switching was expensive and the software worked.
That company still exists inside Oracle's results every quarter. What has changed is who runs it and what it spends money on. In September 2025, Safra Catz stepped down after eleven years as sole chief executive to become executive vice chair, and Oracle named two co-chief executives in her place: Clay Magouyrk, who joined from Amazon Web Services in 2014 and had spent more than a decade building Oracle's cloud infrastructure platform, and Mike Sicilia, who runs Oracle's applications and AI products. Larry Ellison kept his titles of executive chairman and chief technology officer but has largely stayed off Oracle's earnings calls through 2026, leaving Magouyrk and Sicilia to field analyst questions.
Promoting an infrastructure engineer to co-chief executive the same year Oracle committed to building hundreds of billions of dollars of AI data centre capacity was not a coincidence. Oracle today reports across four lines: cloud (infrastructure plus applications), software licences, hardware, and services. The cloud line, and specifically the infrastructure piece inside it, is now where nearly all of the growth, the capital spending and the investor attention sit.
🧩 Segment breakdown: the cloud is carrying a company that still sells licences
Oracle's fiscal first quarter of 2027, the three months to 31 August 2026 and reported on 10 September 2026, shows exactly how lopsided the business has become. Total revenue reached 19.3 billion dollars, up 30% year-on-year, per Oracle's Q1 FY27 earnings release. Cloud revenue, combining infrastructure and applications, rose 62% to 11.6 billion dollars. Inside that line, cloud infrastructure, the raw compute and storage business that rents capacity to AI labs and enterprises, jumped 121% to 7.4 billion dollars, while cloud applications such as Fusion ERP and NetSuite grew a comparatively modest 10% to 4.2 billion dollars.
The older parts of the business tell a different story. Software licence revenue, the traditional on-premise business Oracle built its name on, fell 3% to 5.55 billion dollars as customers keep migrating off it. Hardware revenue rose 15% to 774 million dollars, driven by Exadata and AI-adjacent systems rather than a broader server revival, and services revenue rose 5% to 1.41 billion dollars.
Cloud infrastructure alone, a line that barely registered five years ago, is now bigger than Oracle's entire software licence business and growing more than ten times as fast. That single fact is the clearest evidence that Oracle's centre of gravity has shifted.
⚡ The core strategic bet: renting out the AI boom
The number that dominates every conversation about Oracle in 2026 is its remaining performance obligations, or RPO, a measure of contracted revenue that customers have committed to but Oracle has not yet recognised. RPO reached 664 billion dollars at the end of Q1 FY27, up 209 billion dollars year-on-year and 26 billion dollars from the prior quarter, after Oracle booked more than 30 billion dollars of new AI cloud contracts in the quarter alone, per Oracle's own investor materials. Management has said it expects roughly half of that backlog to convert into recognised revenue over the next three years, a multi-year runway most software companies would never dream of disclosing.