Oracle is spending nearly all its revenue on AI infrastructure, and investors are not thrilled

Oracle just did something that would make most CFOs break out in hives. The company reported fiscal year 2026 capital expenditures of $55.7 billion, consuming roughly 82.6% of its total revenue of $67.4 billion. That left the enterprise software titan with a negative free cash flow of $23.7 billion. In English: for every dollar Oracle brought in, it spent about 83 cents building stuff. The result is a company that, by traditional financial metrics, is bleeding money while betting everything on becoming an AI infrastructure powerhouse. The numbers tell a story of controlled chaos Oracle’s fiscal 2026 results, released on June 10, paint a picture of a company growing fast and spending faster. Revenue climbed 17% year-over-year, a healthy clip for a firm of Oracle’s size. But the $55.7 billion capex figure actually exceeded the company’s own prior guidance of $50 billion. The company has amassed a record $638 billion in remaining performance obligations, essentially the total value of contracts yet to be fulfilled. That number reflects a wave of large AI contracts flowing into Oracle’s pipeline. Customer prepayments for AI contracts alone total $75 billion, suggesting enterprise clien...