Oracle shares rose on Wednesday after the company forecast $225 billion in fiscal 2030 revenue and capped new funding at $20 billion. Its CFO also said free cash flow should turn positive in the second half of fiscal 2028.
Oracle shares jumped on Wednesday after the software company issued a revenue forecast of $225 billion for fiscal 2030. The target implies 35% average annual growth. Shares were up more than 8% in afternoon trading, after falling around a third so far this year.
Funding limited to $20 billion
Oracle also said it committed to limit additional funding for fiscal 2027 through 2030 to $20 billion. It expects that total to be divided equally between equity and debt.
The company said in an SEC filing that vendor financing, customer-provided hardware and customer prepayments are expected to reduce upfront cash requirements during the transition to positive free cash flow.
Cash flow turn set for fiscal 2028
CFO Hilary Maxson said at the investor day that Oracle expects free cash flow to turn positive in the second half of fiscal 2028. She said it should exceed $30 billion in fiscal 2029 as capital spending declines.
Oracle has become a focal point of investor worries about the cost of AI infrastructure, according to Reuters. The agency notes the company relies heavily on a single customer, OpenAI.
Targets for fiscal 2027 and 2030
For fiscal 2030, Oracle also forecast an adjusted operating margin above 40% and adjusted earnings per share of more than $21. It reaffirmed its fiscal 2027 forecast of more than $90 billion in revenue and adjusted earnings of $8.10 per share.
Analysts polled by LSEG had expected growth of 8% in fiscal 2027, followed by significant acceleration over the next two years.
Sources: CNBC, Reuters via Investing.com
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