Oracle OpenAI Data Center Delays Disputed After Earnings
Oracle OpenAI data center delays were disputed after earnings; investors weighed higher AI infrastructure spending and timing risk to revenue.
KEY TAKEAWAYS
- Oracle disputed reports of OpenAI data center delays following its fiscal Q2 results.
- Remaining performance obligations totaled $523.0 billion, up 438.0% year on year.
- Management signaled roughly $15.0 billion of additional AI infrastructure spending, raising timing and capital intensity concerns.
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Oracle Corporation (NYSE: ORCL) disputed reports of delays in its Oracle OpenAI data centers after reporting fiscal second-quarter 2026 results on Dec. 10, 2025. Investors focused on the company’s increased AI infrastructure spending and a large contracted backlog.
Quarter Results and Guidance
Oracle reported remaining performance obligations (RPO) of $523 billion, up 438% year on year, which management described as a measure of contracted future revenue driven largely by AI and cloud commitments. The company posted revenue of $16.1 billion, a 14.2% increase from a year earlier but slightly below analyst expectations of $16.2 billion. Adjusted earnings per share (EPS) were $2.26, exceeding estimates. Cloud infrastructure revenue rose about two-thirds to roughly $4.1 billion. Adjusted operating income was near $6.7 billion, with a 41.9% margin. The software business showed weaker trends, with software revenue around $5.9 billion and new license revenue declining double digits.
For the current quarter, Oracle guided adjusted EPS between $1.64 and $1.68 and revenue growth of 16% to 18%, both below market expectations. The company also signaled roughly $15 billion in additional planned spending, reflecting expanded AI infrastructure investment. Management highlighted flexible funding options, including customer-provided hardware and leasing, and emphasized maintaining an investment-grade credit rating while executing the program.
Delay Reports and Company Response
Reports indicated that several data centers intended to support OpenAI workloads were delayed from 2027 to 2028 due to labor and material shortages. These facilities are part of Oracle’s global build-out of its cloud infrastructure.
An Oracle spokesperson denied these delays, stating there have been “no delays” in its arrangement with OpenAI but declined to specify when related capacity would be activated. This contrast highlights execution risks tied to Oracle’s front-loaded infrastructure push and intensifies investor scrutiny over whether the company can convert its large contracted backlog into revenue within the timeline implied by management’s guidance and increased spending.
The tension between the reported delays and Oracle’s denial underscores concerns about capital intensity, margin pressure, and the timing of returns on AI infrastructure investments. Analysts note the company is entering the heaviest phase of its AI build-out, with a mismatch between near-term spending and revenue conversion.
