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Oracle Cloud Infrastructure Revenue Could Exceed Expectations, Oppenheimer Says

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Oracle Cloud Infrastructure Revenue Could Exceed Expectations, Oppenheimer Says

Oracle's (ORCL) fiscal fourth-quarter revenue from its cloud services could exceed Wall Street's estimates, Oppenheimer said in a note on Monday.

The cloud computing company is scheduled to release its results on Wednesday.

Oppenheimer projects Oracle's cloud infrastructure revenue to grow 96% to $5.87 billion in the fourth quarter, compared with the consensus estimate that calls for a 92% jump.

Assuming the beat materializes, the company could exceed its own full-year cloud infrastructure guidance by $180 million, reflecting a 400-basis-point upside to the Street's estimates, according to the brokerage.

This could set Oracle up for higher cloud infrastructure revenue guidance in fiscal 2027 despite tough year-over-year comparisons, Oppenheimer analysts Brian Schwartz and Idan Gutkind said.

Oppenheimer continues to forecast earnings per share of $1.98 for the fourth quarter, above analysts' views that it put at $1.95. The brokerage projects 19% year-over-year growth in total revenue to $18.92 billion, while the Street is looking at $19.1 billion.

"We expect to see positive results from Oracle in its seasonally strong (fourth quarter) and support for our superior EPS compounder thesis," Schwartz and Gutkind said.

Oppenheimer cited several factors behind its upbeat earnings view on Oracle, including the company's plans to layoff 30,000 people.

The brokerage raised its price target on Oracle to $275 from $235, while reiterating its outperform rating on the stock.

Price: $214.45, Change: $+0.76, Percent Change: +0.36%

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