ORCL
Oracle Corp.
Recurring SaaS
★ Quality 62/100Price today
$158.78
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See what it is worthcharlieapp.co
What this business is made of
The business
Oracle rents out the digital warehouses where the world's AI keeps its brain.
Oracle sells databases and enterprise software by subscription, and now rents out cloud computing capacity (OCI) to train artificial intelligence. It charges multi-year contracts: recurring revenue of $67.4B and signed commitments from clients like OpenAI, Meta and NVIDIA totaling $553B, eight times its annual billing.
Switching databases is like changing a building's foundation with people still inside: expensive, slow and terrifying. That fear of migrating locks in decades of clients. Its AI layer is newer and less defensible, but long-term contracts buy time.
Revenue history
From $42.4B to $67.4B in 4 years. The business grows steadily.
Where each $100 of sales goes
Revenue $67.4B · FY2026
Of every $100 in sales, $75 goes to costs and operations; $25 is left as net profit (25% margin).
Catalysts and risks
RPO (contracted revenue not yet billed) of $553B, +325% year-over-year.
Guidance of $90B in revenue for FY2027.
AI infrastructure buildout scaling capacity for clients already signed.
Capex of $50B in FY2026 leaves free cash flow at -$23.7B.
High debt financing the data center expansion.
The AI cloud faces Amazon, Microsoft and Google, rivals with more muscle.
Charlie's note
“You pay nearly 22 times cash flow for a business growing at 20% with clients who don't leave. Reasonable if the buildout delivers what's promised; the negative cash flow is the bill for building today what you'll charge for over a decade.”
Analysis · June 2026
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