Oracle ( ORCL ) shares jumped 11% in premarket trading Wednesday after the company delivered stronger-than-expected results and pushed back against fears of a looming “SaaS apocalypse,” easing investor concerns about both AI disruption and its latest debt hike.
Revenue rose 18% to $17.19 billion, beating analysts’ estimate of $16.92 billion, according to the Wall Street Journal. Cloud revenue increased 41%, while cloud infrastructure sales rose 81%, underscoring strong demand linked to artificial intelligence.
Management used the earnings call to directly address concerns that generative artificial intelligence could undermine traditional software vendors. Executives argued the opposite, saying customers want AI embedded directly into mission-critical systems rather than replacing them with standalone tools.
The results also helped calm concerns about Oracle’s balance sheet after the company said it planned to raise up to $50 billion in debt and equity to fund AI infrastructure. Oracle said $30 billion has already been raised through investment-grade bonds and mandatory convertible preferred stock, with demand heavily oversubscribed.
Oracle’s gains also lifted the iShares Expanded Tech-Software Sector ETF ( IGV ) about 1% in premarket trading, where Oracle is the fourth-largest holding. The move contrasted with bitcoin, which has fallen about 0.5% ahead of US CPI data, suggesting the close correlation between software stocks and bitcoin may be easing.
Earlier in the year, the two had moved in close together. IGV is down about 34% from its October high, a decline that coincided with bitcoin’s roughly 50% correction as both software stocks and crypto sold off in tandem.
