Oracle: The AI Infrastructure Juggernaut Hiding In Plain Sight

2026-03-13 08:30:41 ET

Oracle Corporation ( ORCL ) is in the middle of a massive bet as it's pouring capital into AI cloud infrastructure at a pace that would have been unthinkable a few years ago. ORCL’s Q3 fiscal 2026 earnings backed up the story with 22% YoY revenue growth, 84% cloud infrastructure growth, and a 325% jump in remaining performance obligations (RPO) to $553 billion. The part that has the market worried is that ORCL is borrowing heavily to reimagine the future of its company. ORCL’s long-term debt has ballooned to $124.72 billion, and it is generating -$24.74 billion in free cash flow ((FCF)). I’m bullish on ORCL for the long term because I think its cloud infrastructure spending will drive serious cash from operations growth over the next two to three years, just like we saw with the hyperscalers before it. This is not a set-it-and-forget-it type of investment, as its data center delivery, debt management, and RPO conversion all have to go right. If ORCL doesn’t deliver on these metrics, the stock is likely to retrace to the downside. I believe that the investment case in ORCL needs years to play out, not months. Based on what the other hyperscalers have produced, I feel that ORCL’s future earnings will be strong, and this is an investment that could generate significant alpha in the future....

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