Following the recent release of its fiscal 2026 fourth-quarter (ended May 31, 2026) results, U.S. database giant Oracle (ORCL) has seen a rare divergence in market reaction. Although the financial report was not weak, the company’s stock fell as much as 11% in early trading on Thursday, eventually closing down approximately 8.5%. The results showed that Oracle’s quarterly revenue grew 21% year-over-year to $19.2 billion, with cloud business revenue surging 47% to $9.9 billion. More notably, the company’s remaining performance obligations (unfulfilled contract revenue) soared to $638 billion, an increase of $85 billion in just three months.
Investors have focused their attention on Oracle’s spending plans. The company’s capital expenditures for fiscal 2026 reached $55.7 billion, higher than management’s previous forecast of $50 billion, while free cash flow was negative $23.7 billion. Even more aggressively, management expects net cash spending for fiscal 2027 to reach approximately $70 billion (after deducting customer prepayments). To this end, Oracle plans to raise about $40 billion through new debt and equity financing.
In contrast to the pessimistic sentiment in the stock market, bond investors welcomed Oracle’s financing signals, and the company’s bond prices rose broadly. The company explicitly stated that it would not issue any new bonds for the remainder of the year, a statement that quickly boosted confidence in the bond market. The credit spread on Oracle’s bonds due in 2050 with a 3.6% coupon rate narrowed to approximately 1.93 percentage points, while the credit spread on bonds due in 2046 with a 6.55% coupon rate also fell to a similar level. In the credit default swap market, the cost for investors to buy default insurance on Oracle’s debt also dropped significantly.
Every dollar spent will translate into revenue for suppliers, and the following three companies are most likely to benefit.
Nvidia (NVDA) is the most obvious beneficiary. Oracle’s flagship Zettascale10 superclusters are all built on Nvidia hardware, with initial deployment targets including up to 800,000 Nvidia graphics processors. Oracle’s co-chief executive officer stated that the company plans to bring nearly 1 gigawatt of computing capacity online this quarter, almost equivalent to the entire increase for fiscal year 2026. Recently, most of Oracle’s contract growth has come from large AI deals, where customers either prepay for GPUs or directly purchase chips and supply them to Oracle. The total value of such contracts has reached $75 billion.
AMD (AMD) may be the company that receives orders most directly from Oracle. The two parties previously announced that Oracle’s cloud division would be the launch partner for the first public AI supercluster built on AMD Instinct MI450 GPUs, with an initial deployment of 50,000 chips, scheduled to launch in the third quarter of 2026.
Dell Technologies (DELL) will also benefit, as GPUs need to be delivered alongside servers and rack systems. Dell now expects AI server revenue for the current fiscal year to reach approximately $60 billion, with AI backlog orders hitting a record $51.3 billion.
When hardware is shipped, suppliers can recognize revenue, whereas Oracle needs customers to consume cloud services over many years to recoup its investment. The spending plan that worries Oracle investors is precisely the source that fills suppliers’ order books. Of course, suppliers also face their own risks: if AI demand falls short of expectations or financing conditions tighten, hardware orders could slow down rapidly. Overall, suppliers offer a simpler way to participate in AI infrastructure construction than Oracle itself.
