Shares of Oracle ( ORCL ) jumped 11% in premarket trading Wednesday after the company reported better-than-expected results and fended off fears of a looming “SaaS apocalypse,” easing investor concerns about both AI disruption and its recent debt increase.
Revenue climbed 18% to $17.19 billion, beating analysts’ $16.92 billion, according to the Wall Street Journal. Cloud revenue increased 41%, while cloud infrastructure sales increased 81%, highlighting strong demand related to artificial intelligence.
Management used the earnings call to directly address concerns that generative AI could harm traditional software companies. Executives argued the opposite, saying customers want AI integrated directly into critical systems rather than replacing them with standalone tools.
The results also helped ease concerns about Oracle’s balance sheet after the company announced plans to raise up to $50 billion in debt and equity to fund AI infrastructure. Oracle said $30 billion has already been raised through investment-grade bonds and mandatory convertible preferred stock, with demand heavily oversubscribed.
Oracle’s gains also sent the iShares Expanded Tech-Software Sector ETF (IGV) up about 1% in premarket trading, where Oracle is the fourth-largest stock. The move contrasts with Bitcoin, which is down around 0.5% ahead of US CPI data, suggesting the tight correlation between software stocks and Bitcoin may be easing.
Earlier this year, the two men had worked closely together. IGV fell about 34% from its October high, a drop that coincided with bitcoin’s roughly 50% correction, with software and crypto stocks selling off in tandem.
