A $10,000 investment in Oracle (ORCL -3.65%) made one year ago is worth about $6,300 today, dividends included. The stock closed at $248.28 on Aug. 15, 2025, and it trades at about $154 as of this writing — a decline of about 38%.
That one number undersells the ride. Within a month of that purchase, the stake was briefly worth almost $14,000. By late July of this year, it had shrunk to about $4,600. I can’t think of another company this large that traveled that far in both directions in 12 months.
Here’s the path between those two numbers.
Image source: Getty Images.
The pop
Last Sept. 9, Oracle reported fiscal 2026 first-quarter results that changed how the market thought about the company. Revenue grew 12%, which was fine.
The number that mattered was remaining performance obligations (RPO), the contracted future revenue the company hasn’t yet delivered. RPO hit $455 billion, up 359% year over year, on a handful of multibillion-dollar artificial intelligence (AI) contracts.
The next day, the stock rose 36%, its biggest one-day gain since 1992, adding about $244 billion of market value and touching a record high of $345.72 along the way. At that peak, the $10,000 stake was briefly worth nearly $14,000. Management also laid out a path for cloud infrastructure revenue to grow from $18 billion in fiscal 2026 to a projected $144 billion by fiscal 2030.
And the demand itself held up, for what it’s worth. RPO kept climbing all year and ended fiscal 2026 (this past May) at $638 billion, up $85 billion in the final quarter alone. Cloud infrastructure revenue accelerated as the year went on, from 55% year-over-year growth in the fiscal first quarter to 93% by the fiscal fourth quarter, reaching $18.1 billion for the full year. Total revenue rose 17% to $67.4 billion, and earnings per share climbed 34% to $5.83 on a generally accepted accounting principles (GAAP) basis.
Paying for it
So the growth showed up. What the market spent the rest of the year weighing was the bill for delivering it.
Oracle spent $55.7 billion on capital expenditures in fiscal 2026, up from $21.2 billion in fiscal 2025. That spending more than doubled in a single year. Operating cash flow of $32.0 billion, up an impressive 54%, couldn’t keep pace, and free cash flow came in at negative $23.7 billion.
To cover the gap, the company raised $43 billion in debt and $5 billion in equity during the fiscal year, and it expects to raise about $40 billion more in fiscal 2027, including a $20 billion at-the-market stock issuance (selling new shares directly into the market) that dilutes existing shareholders.
The cost-cutting turned severe, too. Oracle ended fiscal 2026 with about 141,000 full-time employees, roughly 21,000 fewer than a year earlier. Of course, the dividend kept arriving ($0.50 per quarter, or about $80 on the stake over the year), but that barely dents a decline of this size.
Investors repriced the company accordingly. The stock had its worst week since 2001 in late June, and in late July it touched a 52-week low of $114.50 — down 67% from the September peak. At that price, shares fetched about 14 times the earnings management was guiding for. A $10,000 stake from August 2025 was worth about $4,600 that day.
Today’s Change
(-3.65%) $-5.70
Current Price
$150.52
Key Data Points
Market Cap
Day’s Range
$148.80 – $156.39
52wk Range
$114.50 – $345.72
Volume
21.9M
Avg Vol
31.9M
Gross Margin
63.34%
Dividend Yield
1.33%
Where that leaves it
Shares have recovered about 35% from the July low. And the growth is not slowing. Management guided for fiscal 2027 revenue of about $90 billion, up more than 30%, with first-quarter revenue expected to grow 27% to 29%.
However, the price of that growth has changed character entirely. The fiscal 2027 guidance also calls for $8.05 of non-GAAP (adjusted) earnings per share, which puts the stock at about 19 times its own earnings guidance. That’s far below the premium the stock commanded last fall, and the multiple looks reasonable only if the guidance is hit while tens of billions of dollars of spending continue.
In short, the market never stopped believing in Oracle’s demand. The backlog grew through the entire decline. What changed is the price investors will pay for growth that requires this much capital and this much dilution to deliver.
A year ago, the market valued Oracle like a software company with an exciting backlog. Today it’s valued like what it has become — a capital-intensive builder of AI infrastructure. The lower price arguably fits the harder business.
