ORCL · Forward model
Revenue by vertical, 20 quarters out
Model as of
Each segment is projected from its own operating driver, rolled up into consolidated cash flow, and discounted back to a fair value per share. The assumptions below are editable — change them and every number on this page moves with them.
Oracle publishes all six revenue lines by quarter, and they sum exactly to reported consolidated revenue in all eight quarters. Quarter labels are fiscal: 2026 Q4 ended 31 May 2026. Revenue history is disclosed; the cost split is assumed. Hardware and Services carry disclosed segment margins, while the four cloud-and-software offerings use assumed margins that weight-average to the disclosed segment result. Software license and hardware now use trend-adjusted seasonality derived from Oracle's fiscal 2025 and 2026 offering tables. The factors average to one, so the Q4 peak and Q1 reset move revenue between quarters without altering the underlying annual trend. Live OCI megawatts remain undisclosed, so the 2,000 MW basis and resulting $2.97M revenue per megawatt-quarter are inferred. Capex uses Oracle's net cash-outlay basis. The model still excludes planned FY2027 equity issuance and mandatory-convertible dilution; base free cash flow remains negative until FY2030.
Shares this page's scenario. Driver and horizon edits stay in your browser — the recipient sees the published model.
Latest: $60.39B (2031Q4E)
| Period | Value |
|---|---|
| 2025Q1 | $13.31B |
| 2025Q2 | $14.06B |
| 2025Q3 | $14.13B |
| 2025Q4 | $15.90B |
| 2026Q1 | $14.93B |
| 2026Q2 | $16.06B |
| 2026Q3 | $17.19B |
| 2026Q4 | $19.18B |
| 2027Q1E | $19.35B |
| 2027Q2E | $21.22B |
| 2027Q3E | $22.85B |
| 2027Q4E | $25.41B |
| 2028Q1E | $25.87B |
| 2028Q2E | $27.94B |
| 2028Q3E | $29.78B |
| 2028Q4E | $32.49B |
| 2029Q1E | $33.28B |
| 2029Q2E | $35.58B |
| 2029Q3E | $37.66B |
| 2029Q4E | $40.57B |
| 2030Q1E | $41.73B |
| 2030Q2E | $44.28B |
| 2030Q3E | $46.65B |
| 2030Q4E | $49.80B |
| 2031Q1E | $51.36B |
| 2031Q2E | $54.23B |
| 2031Q3E | $56.94B |
| 2031Q4E | $60.39B |
What drives each segment
Cloud infrastructure (OCI)
Capacity × utilisation × priceThe whole model. OCI is 30% of FY2026 revenue and effectively all of the growth: $18.1B, up 77%, with the June quarter alone up 93%. It carries GPU training and inference capacity, Oracle Database in OCI, the multicloud database running inside AWS, Azure and Google, and ordinary compute and storage. Revenue is gated by delivered datacenter capacity, not demand — Oracle reports 97.5% global GPU utilisation and says recognition follows site delivery, so the projection is a build schedule in megawatts, a utilisation rate and a price per megawatt-quarter.
Latest: $45.85B (2031Q4E)
| Period | Value |
|---|---|
| 2025Q1 | $2.15B |
| 2025Q2 | $2.43B |
| 2025Q3 | $2.65B |
| 2025Q4 | $3.00B |
| 2026Q1 | $3.35B |
| 2026Q2 | $4.08B |
| 2026Q3 | $4.89B |
| 2026Q4 | $5.79B |
| 2027Q1E | $7.20B |
| 2027Q2E | $8.66B |
| 2027Q3E | $10.18B |
| 2027Q4E | $11.75B |
| 2028Q1E | $13.38B |
| 2028Q2E | $15.07B |
| 2028Q3E | $16.81B |
| 2028Q4E | $18.62B |
| 2029Q1E | $20.48B |
| 2029Q2E | $22.42B |
| 2029Q3E | $24.42B |
| 2029Q4E | $26.49B |
| 2030Q1E | $28.63B |
| 2030Q2E | $30.84B |
| 2030Q3E | $33.13B |
| 2030Q4E | $35.50B |
| 2031Q1E | $37.96B |
| 2031Q2E | $40.50B |
| 2031Q3E | $43.13B |
| 2031Q4E | $45.85B |
Assumptions & reasoning
- Live megawatts are the weakest input here. Oracle discloses capacity DELIVERED (more than 1.2 GW in FY26, approaching 1 GW in Q1 FY27) but never the live earning base, so the 2,000 MW at the basis quarter is inferred and the price per megawatt falls out of it rather than being observed.
- Delivered is not earning. Capacity handed over inside a quarter earns for only part of it, so the megawatts added in this driver run below Oracle's headline delivery figures on purpose — the engine gives a full quarter of revenue to everything it adds.
- The implied $2.97M per megawatt-quarter is roughly 1.7x what CoreWeave's disclosure implies for a pure GPU cloud, which is the right direction: OCI also carries database, multicloud and ordinary IaaS revenue that consumes little power.
- Capex intensity here is set on Oracle's NET cash outlay basis ($47.7B in FY26), not reported capex ($55.7B). Oracle itself presents the net figure as the real funding requirement, and the difference is customer prepayments and third-party manufacturer timing — the same prepayments that make the RPO convertible.
- The $90B FY2027 guide implies OCI revenue of roughly $39B once the five other lines are grown at their observed rates — about 22% above the $32B in the September 2025 five-year schedule. Either the schedule has been quietly raised or the non-infrastructure lines must accelerate; nothing Oracle published at Q4 resolves which.
Cloud applications (SaaS)
Growth pathFusion and NetSuite-class ERP, HCM, CX and industry suites — the business Oracle spent a decade building before AI arrived. It grew 11% in FY2026 to $15.9B and has grown between 9% and 13% in every quarter of the last two years, which is the point: it is the stable half of cloud and the reason total cloud growth is not a pure function of GPU deliveries.
Latest: $6.14B (2031Q4E)
| Period | Value |
|---|---|
| 2025Q1 | $3.47B |
| 2025Q2 | $3.50B |
| 2025Q3 | $3.56B |
| 2025Q4 | $3.74B |
| 2026Q1 | $3.84B |
| 2026Q2 | $3.90B |
| 2026Q3 | $4.03B |
| 2026Q4 | $4.13B |
| 2027Q1E | $4.23B |
| 2027Q2E | $4.33B |
| 2027Q3E | $4.43B |
| 2027Q4E | $4.53B |
| 2028Q1E | $4.63B |
| 2028Q2E | $4.73B |
| 2028Q3E | $4.83B |
| 2028Q4E | $4.93B |
| 2029Q1E | $5.03B |
| 2029Q2E | $5.13B |
| 2029Q3E | $5.23B |
| 2029Q4E | $5.33B |
| 2030Q1E | $5.43B |
| 2030Q2E | $5.53B |
| 2030Q3E | $5.63B |
| 2030Q4E | $5.73B |
| 2031Q1E | $5.83B |
| 2031Q2E | $5.93B |
| 2031Q3E | $6.04B |
| 2031Q4E | $6.14B |
Assumptions & reasoning
- This line is remarkably steady — 10%, 10%, 9%, 12%, 11%, 11%, 13%, 10% year over year across the eight reported quarters — which is why a growth driver costs almost nothing in fidelity here and why it anchors the non-AI half of the story.
- Oracle gave one piece of forward colour that is not modellable: SaaS deferred revenue grew 16% in Q4, faster than the 10% revenue growth. That is a leading indicator with no disclosed conversion rate, so it is noted rather than used.
Software support
Growth pathThe annuity under the old Oracle: maintenance on the on-premise licence base, about $19.8B a year and essentially flat for three years. It funds everything else. It declines slowly as customers migrate to cloud, and the migration is visible in the licence line above it rather than here, because support attrition lags licence attrition by years.
Latest: $4.42B (2031Q4E)
| Period | Value |
|---|---|
| 2025Q1 | $4.90B |
| 2025Q2 | $4.87B |
| 2025Q3 | $4.80B |
| 2025Q4 | $4.96B |
| 2026Q1 | $4.96B |
| 2026Q2 | $4.94B |
| 2026Q3 | $4.97B |
| 2026Q4 | $4.94B |
| 2027Q1E | $4.94B |
| 2027Q2E | $4.94B |
| 2027Q3E | $4.93B |
| 2027Q4E | $4.92B |
| 2028Q1E | $4.90B |
| 2028Q2E | $4.88B |
| 2028Q3E | $4.86B |
| 2028Q4E | $4.83B |
| 2029Q1E | $4.80B |
| 2029Q2E | $4.77B |
| 2029Q3E | $4.74B |
| 2029Q4E | $4.71B |
| 2030Q1E | $4.68B |
| 2030Q2E | $4.64B |
| 2030Q3E | $4.61B |
| 2030Q4E | $4.57B |
| 2031Q1E | $4.53B |
| 2031Q2E | $4.49B |
| 2031Q3E | $4.46B |
| 2031Q4E | $4.42B |
Assumptions & reasoning
- Flat is the finding, not an absence of one: $19.5B, $19.5B and $19.8B across FY2024 to FY2026 while licence revenue fell 9% in the last year. Support has not yet followed licence down, and when it does it takes roughly 85 cents of segment margin per dollar with it.
- The margin assigned here is the single largest cost assumption in the brief. Oracle publishes one margin for all of cloud and software, so an 85% support margin and a 27% infrastructure margin are a judgement about mix, constrained only by having to average back to the disclosed blend.
Software license
Growth pathNew on-premise licence sales, in structural decline as the installed base migrates to cloud: $4.7B in FY2026, down 9%. It is small and shrinking, but it matters twice over — it is the leading indicator for the support annuity beneath it, and it is violently seasonal, with a fourth quarter roughly twice the size of a first quarter.
Latest: $1.07B (2031Q4E)
| Period | Value |
|---|---|
| 2025Q1 | $870M |
| 2025Q2 | $1.20B |
| 2025Q3 | $1.13B |
| 2025Q4 | $2.01B |
| 2026Q1 | $766M |
| 2026Q2 | $939M |
| 2026Q3 | $1.15B |
| 2026Q4 | $1.88B |
| 2027Q1E | $752M |
| 2027Q2E | $964M |
| 2027Q3E | $1.02B |
| 2027Q4E | $1.70B |
| 2028Q1E | $679M |
| 2028Q2E | $868M |
| 2028Q3E | $914M |
| 2028Q4E | $1.53B |
| 2029Q1E | $607M |
| 2029Q2E | $775M |
| 2029Q3E | $815M |
| 2029Q4E | $1.36B |
| 2030Q1E | $541M |
| 2030Q2E | $689M |
| 2030Q3E | $724M |
| 2030Q4E | $1.21B |
| 2031Q1E | $480M |
| 2031Q2E | $611M |
| 2031Q3E | $643M |
| 2031Q4E | $1.07B |
Assumptions & reasoning
- This is the most seasonal line Oracle reports: 870, 1195, 1129, 2007 through FY2025 and 766, 939, 1150, 1881 through FY2026. The four factors average to one and are derived from both years after removing each year's annual trend, so the Q4 peak and Q1 reset no longer distort the growth input.
- The first-quarter growth input now represents the underlying annual decline rather than a one-quarter reset from the fiscal Q4 peak. At -2.3% a quarter it reproduces roughly the 9% decline reported for FY2026 before gliding toward the -3% terminal rate.
Hardware
Growth pathEngineered systems, servers and storage — Exadata and its relatives, $3.1B in FY2026 and up 5%, the first growth in years as Exadata rides the database business into cloud. Small, seasonal, and profitable at a 65% segment margin, but structurally a supporting act.
Latest: $1.05B (2031Q4E)
| Period | Value |
|---|---|
| 2025Q1 | $655M |
| 2025Q2 | $728M |
| 2025Q3 | $703M |
| 2025Q4 | $850M |
| 2026Q1 | $670M |
| 2026Q2 | $776M |
| 2026Q3 | $714M |
| 2026Q4 | $924M |
| 2027Q1E | $701M |
| 2027Q2E | $802M |
| 2027Q3E | $763M |
| 2027Q4E | $961M |
| 2028Q1E | $725M |
| 2028Q2E | $827M |
| 2028Q3E | $784M |
| 2028Q4E | $986M |
| 2029Q1E | $743M |
| 2029Q2E | $847M |
| 2029Q3E | $802M |
| 2029Q4E | $1.01B |
| 2030Q1E | $759M |
| 2030Q2E | $865M |
| 2030Q3E | $819M |
| 2030Q4E | $1.03B |
| 2031Q1E | $775M |
| 2031Q2E | $883M |
| 2031Q3E | $836M |
| 2031Q4E | $1.05B |
Assumptions & reasoning
- This is one of only two verticals whose margin is disclosed rather than assumed: the 10-K reports hardware segment operating income of $2,017M on $3,084M of revenue, a 65.4% margin that has held within a point for three fiscal years.
- The line turned positive in FY2026 after years of decline, growing 5%. Oracle attributes that to Exadata demand pulled along by the database business, which makes it a lagging read on the same thing the infrastructure line measures. Two years of trend-adjusted quarterly factors now carry the recurring Q4 peak without forcing a Q1 contraction into the growth rate.
Services
Growth pathConsulting and support services that implement and migrate customers onto everything else: $5.7B in FY2026, up 10%, and newly profitable at a 26.7% segment margin against 19% two years ago. It is a trailing indicator of cloud adoption — it grows when customers are actively moving, which is why it turned up at the same time OCI did.
Latest: $1.87B (2031Q4E)
| Period | Value |
|---|---|
| 2025Q1 | $1.26B |
| 2025Q2 | $1.33B |
| 2025Q3 | $1.29B |
| 2025Q4 | $1.35B |
| 2026Q1 | $1.35B |
| 2026Q2 | $1.43B |
| 2026Q3 | $1.44B |
| 2026Q4 | $1.52B |
| 2027Q1E | $1.52B |
| 2027Q2E | $1.53B |
| 2027Q3E | $1.53B |
| 2027Q4E | $1.54B |
| 2028Q1E | $1.55B |
| 2028Q2E | $1.57B |
| 2028Q3E | $1.58B |
| 2028Q4E | $1.60B |
| 2029Q1E | $1.61B |
| 2029Q2E | $1.63B |
| 2029Q3E | $1.65B |
| 2029Q4E | $1.67B |
| 2030Q1E | $1.69B |
| 2030Q2E | $1.72B |
| 2030Q3E | $1.74B |
| 2030Q4E | $1.76B |
| 2031Q1E | $1.79B |
| 2031Q2E | $1.81B |
| 2031Q3E | $1.84B |
| 2031Q4E | $1.87B |
Assumptions & reasoning
- The margin here is disclosed and it has moved hard: segment operating income went from $916M on $5,431M in FY2024 to $1,533M on $5,743M in FY2026, nearly doubling the margin on 6% more revenue.
- Services growth turned from -3% in FY2024 to +10% in FY2026, inflecting in the same year OCI did. Treat it as confirmation of migration activity rather than as an independent driver.
Where each case comes from
Bear case — primary sources
The primary sources this case is built from — filings, calls and posts. Where they are claims by an interested party rather than disclosures, every number in the Bear column is what happens if they are taken at face value.
Gross margin steps down in FY2027
The financing requirement
- Jun 10, 2026 In fiscal year 2027, Oracle expects to raise approximately $40 billion through a combination of debt and equity financing including its previously announced $20 billion at-the-market equity issuance.
- Jun 10, 2026 Free cash flow was negative $23.7 billion for fiscal year 2026 as Oracle continued to execute on investments to support the growth of its Cloud Infrastructure business.
Bull case — primary sources
The primary sources this case is built from — filings, calls and posts. Where they are claims by an interested party rather than disclosures, every number in the Bull column is what happens if they are taken at face value.
The multi-year OCI revenue schedule
Long-term CAGRs reconfirmed at Q4 FY2026
Prepaid and customer-supplied hardware reduce the capital Oracle must raise
Concentration case — primary sources
The primary sources this case is built from — filings, calls and posts. Where they are claims by an interested party rather than disclosures, every number in the Concentration column is what happens if they are taken at face value.
Q4 signings and customer concentration
The GPU renewal cohort
From cash flow to fair value
| Present value of free cash flow, 20 quarters | -$36.06B |
| Terminal-year revenue | $222.93B |
| Terminal-year EBITDA | $100.33B |
| Exit multiple, on revenue | 5.5x |
| Terminal value | $1.23T |
| Discounted at 9.5% a year, terminal value becomes | $778.85B |
| Enterprise value | $742.78B |
| Net cash | -$97.65B |
| Equity value | $645.14B |
| Shares | 2.92B |
| Fair value per share | $221.32 |
| Against the deployed price of $158.78, as of | +39% |
9.5% pays for an investment-grade mega-cap carrying $129.5B of debt, negative free cash flow and about $40B a year of planned issuance. The 5.5x exit is a cloud-and-software blend at maturity, between the house marks for CRM at 4.5x and META at 6.0x.
Read the other way round: at $158.78 the market is paying 4.2x terminal-year revenue, holding every other assumption on this page fixed. That is the number to argue about.
The projected path
| Quarter | Cloud infrastructure (OCI) | Cloud applications (SaaS) | Software support | Software license | Hardware | Services | Revenue | YoY | EBITDA | Capex | FCF | R40 | PV of FCF |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2027 Q1E | $7.20B | $4.23B | $4.94B | $752M | $701M | $1.52B | $19.35B | +30% | $8.48B | $14.44B | -$5.96B | -1 | -$5.83B |
| 2027 Q2E | $8.66B | $4.33B | $4.94B | $964M | $802M | $1.53B | $21.22B | +32% | $9.38B | $15.60B | -$6.22B | +3 | -$5.94B |
| 2027 Q3E | $10.18B | $4.43B | $4.93B | $1.02B | $763M | $1.53B | $22.85B | +33% | $10.14B | $16.49B | -$6.36B | +5 | -$5.94B |
| 2027 Q4E | $11.75B | $4.53B | $4.92B | $1.70B | $961M | $1.54B | $25.41B | +32% | $11.42B | $17.18B | -$5.76B | +10 | -$5.26B |
| 2028 Q1E | $13.38B | $4.63B | $4.90B | $679M | $725M | $1.55B | $25.87B | +34% | $11.45B | $17.70B | -$6.24B | +10 | -$5.57B |
| 2028 Q2E | $15.07B | $4.73B | $4.88B | $868M | $827M | $1.57B | $27.94B | +32% | $12.43B | $18.08B | -$5.66B | +11 | -$4.94B |
| 2028 Q3E | $16.81B | $4.83B | $4.86B | $914M | $784M | $1.58B | $29.78B | +30% | $13.28B | $18.37B | -$5.09B | +13 | -$4.35B |
| 2028 Q4E | $18.62B | $4.93B | $4.83B | $1.53B | $986M | $1.60B | $32.49B | +28% | $14.62B | $18.59B | -$3.97B | +16 | -$3.31B |
| 2029 Q1E | $20.48B | $5.03B | $4.80B | $607M | $743M | $1.61B | $33.28B | +29% | $14.82B | $18.74B | -$3.92B | +17 | -$3.20B |
| 2029 Q2E | $22.42B | $5.13B | $4.77B | $775M | $847M | $1.63B | $35.58B | +27% | $15.89B | $18.87B | -$2.98B | +19 | -$2.38B |
| 2029 Q3E | $24.42B | $5.23B | $4.74B | $815M | $802M | $1.65B | $37.66B | +26% | $16.85B | $18.98B | -$2.13B | +21 | -$1.66B |
| 2029 Q4E | $26.49B | $5.33B | $4.71B | $1.36B | $1.01B | $1.67B | $40.57B | +25% | $18.27B | $19.10B | -$822M | +23 | -$626M |
| 2030 Q1E | $28.63B | $5.43B | $4.68B | $541M | $759M | $1.69B | $41.73B | +25% | $18.66B | $19.21B | -$549M | +24 | -$408M |
| 2030 Q2E | $30.84B | $5.53B | $4.64B | $689M | $865M | $1.72B | $44.28B | +24% | $19.85B | $19.34B | $432M | +25 | $314M |
| 2030 Q3E | $33.13B | $5.63B | $4.61B | $724M | $819M | $1.74B | $46.65B | +24% | $20.94B | $19.50B | $1.23B | +27 | $873M |
| 2030 Q4E | $35.50B | $5.73B | $4.57B | $1.21B | $1.03B | $1.76B | $49.80B | +23% | $22.46B | $19.69B | $2.36B | +28 | $1.64B |
| 2031 Q1E | $37.96B | $5.83B | $4.53B | $480M | $775M | $1.79B | $51.36B | +23% | $23.05B | $19.91B | $2.67B | +28 | $1.82B |
| 2031 Q2E | $40.50B | $5.93B | $4.49B | $611M | $883M | $1.81B | $54.23B | +22% | $24.38B | $20.17B | $3.58B | +29 | $2.38B |
| 2031 Q3E | $43.13B | $6.04B | $4.46B | $643M | $836M | $1.84B | $56.94B | +22% | $25.63B | $20.48B | $4.37B | +30 | $2.84B |
| 2031 Q4E | $45.85B | $6.14B | $4.42B | $1.07B | $1.05B | $1.87B | $60.39B | +21% | $27.28B | $20.84B | $5.47B | +30 | $3.48B |
Every row is projected. A year-over-year change is shown only where the quarter it compares against exists — an em dash means there is no comparable quarter, not a flat year.
Model revisions
Assumptions are marked to reality as each quarter prints. Every change is appended here, with the fair value the model produced at the time, so the model's own history stays visible.
| Date | Fair value then | Note |
|---|---|---|
| 2026-08-27 | — | Added two-year, trend-adjusted seasonality to software license and hardware. Replaced the artificial first-quarter growth shocks with underlying annual rates: -2.3% quarterly for license (about -9% annually) and +1.2% for hardware (about +5%). OCI and cloud applications remain driven by capacity and recurring growth rather than calendar factors. |
| 2026-08-23 | — | First cut, built from the scope-model intake brief at data/models/intake/orcl.json on the fiscal 2026 Q4 basis. |