Oracle soars after raising annual forecast on robust cloud services demand

• Shares surge more than 7% after the bell
• Quarterly revenue beats estimates

June 11 (Reuters) - Oracle ORCL.N raised its annual revenue growth forecast on Wednesday, betting on robust demand for its cloud offerings from companies deploying artificial intelligence, sending its shares up more than 7% after the bell.

For fiscal 2026, Oracle expects total revenue to be at least $67 billion, CEO Safra Catz said on a post-earnings call.

With the new forecast, annual revenue is expected to grow by around 16.7%, compared with Oracle's prior projection of a 15% growth.

"We expect our total cloud growth rate — applications plus infrastructure — will increase from 24% in fiscal year 2025 to over 40% in fiscal year 2026," Catz said.

The company's growth is largely supported by its Oracle Cloud Infrastructure solution and support for AI workloads.

Oracle's confidence in OCI revenue comes with good reason, said Rebecca Wettemann, CEO of industry analyst firm Valoir. "The multi-cloud approach and the increasing reliance of Oracle enterprise application cloud customers on OCI to support their enterprise data needs are important drivers."

The company's willingness and ability to embed generative AI capabilities in its cloud suite of applications at no additional cost have reduced adoption barriers and encouraged experimentation, Wettemann added.

Revenue for the quarter ended May 31 stood at $15.90 billion, beating analysts' estimate of $15.59 billion.

Quarterly revenue at Oracle's largest unit, cloud services and license support, came in at $11.70 billion, a 14% increase from last year.

Excluding items, the company earned $1.70 per share in the fourth quarter, compared with estimates of $1.64 apiece.