Oracle delivered a strong signal that the global boom in artificial intelligence infrastructure is translating into real business momentum, after reporting a massive surge in future contracted revenue and forecasting sales growth that could exceed Wall Street expectations through 2027.

The enterprise software giant said demand for AI computing capacity is accelerating rapidly as technology companies race to build and deploy generative AI systems. The surge in demand is helping to justify Oracle’s aggressive and debt-funded expansion into large-scale data centers designed specifically for AI workloads.

Investors reacted positively to the outlook, sending Oracle’s shares up about 8.3% in extended trading following the earnings announcement.

At the center of the optimism is the company’s remaining performance obligations (RPO), a key metric that measures the value of contracted revenue yet to be recognized. Oracle said RPO jumped 325% year-on-year to $553 billion in its third quarter. That figure surpassed analysts’ estimates of about $540.37 billion compiled by Visible Alpha and rose sharply from $523 billion reported in the previous quarter.

The scale of the backlog suggests Oracle has already secured long-term commitments from customers that will drive revenue growth for years. Executives said most of the surge in RPO is tied to large AI computing agreements involving companies building and operating advanced AI systems.

These contracts typically involve long-term commitments to rent large volumes of computing capacity from Oracle’s expanding network of data centers. Among the companies relying on Oracle’s infrastructure are leading AI developers, including OpenAI and major technology platforms such as Meta, both of which require enormous computing power to train and operate increasingly sophisticated AI models.

Oracle has been pouring billions of dollars into building and expanding data centers capable of hosting high-performance AI workloads. The strategy marks a significant shift for a company historically known for its enterprise database software.

Over the past several years, Oracle has repositioned itself as a cloud infrastructure provider, competing directly with hyperscale cloud platforms operated by Amazon through its AWS division and Microsoft through Azure. While those rivals dominate the cloud computing market, Oracle is attempting to carve out a niche by offering infrastructure optimized for large-scale AI training and inference workloads.

Industry analysts say the company’s growing backlog suggests the strategy is beginning to gain traction.

“Oracle’s quarter is a beat and a stress test result for the AI trade,” said Jacob Bourne, an analyst at eMarketer. “As the most debt-exposed major player in AI infrastructure, Oracle is the canary in the coal mine and this report suggests there’s underlying health in AI spending beyond the hype.”

Oracle’s heavy borrowing to finance new data centers has been a point of concern for investors. Building AI infrastructure requires enormous capital expenditures for facilities, power systems, and advanced chips.

However, the company said the large AI contracts already secured mean it does not expect to raise additional funds to support its current infrastructure expansion. That assurance helped calm fears that Oracle’s investment cycle might strain its balance sheet before generating meaningful returns.

The company also lifted its long-term financial outlook.

Oracle now expects revenue to reach $90 billion by fiscal 2027, well above analysts’ forecasts of $86.6 billion compiled by LSEG.

Executives believe demand for AI infrastructure will continue to expand as enterprises adopt generative AI technologies across industries ranging from finance and healthcare to manufacturing and retail.

On a call with investors, Oracle executive Clay Magouyrk said profitability in the company’s cloud business should improve significantly as AI infrastructure scales. Magouyrk explained that renting out high-performance chips supplied by partners such as Nvidia is expected to generate margins of around 30% to 40%.

But he noted that a significant portion of customer spending goes beyond raw computing capacity.

Between 10% and 20% of cloud customers’ spending typically flows into additional Oracle services, including the company’s core database products. Those offerings generate much higher profit margins, often ranging between 60% and 80%.

“When you combine all of these pieces together, the overall margin profile of Oracle Cloud Infrastructure continues to strengthen and grows rapidly,” Magouyrk said.

Oracle’s broader strategy also pinpoints the growing influence of artificial intelligence in software development itself.

On the earnings call, Oracle co-founder and executive chairman Larry Ellison addressed rising speculation that AI coding tools could reduce demand for traditional software vendors by allowing companies to generate their own applications.

Ellison argued that the opposite could happen for Oracle.

He said the company is embracing AI coding tools internally to enable smaller engineering teams to build sophisticated new applications more quickly.

“Thank God we have these coding tools now that allow us to build a comprehensive set of software — agent-based software to automate a complete ecosystem like healthcare, or financial services,” Ellison said.

“That’s why we think the ‘SaaS apocalypse’ applies to others but not to Oracle.”

The remarks highlight a broader shift taking place across the technology industry, where AI is not only creating demand for massive computing infrastructure but also reshaping how software itself is built and deployed.

Oracle’s financial results for the quarter also exceeded expectations.

The company reported revenue of $17.19 billion for the third quarter ended February 28, topping analysts’ average estimate of $16.91 billion.

Looking ahead to the current fiscal fourth quarter, Oracle forecast adjusted earnings between $1.96 and $2.00 per share, slightly above analysts’ expectations of $1.94. The company expects overall revenue growth of 19% to 21% in the fourth quarter, broadly consistent with analysts’ forecasts of about 20.2% growth to approximately $19.12 billion. Cloud revenue is expected to grow even faster. Oracle projected cloud sales growth of between 46% and 50%, close to analyst expectations of about 48% growth to nearly $9.98 billion.

The strong projections reinforce the idea that the infrastructure supporting generative AI is becoming one of the most powerful growth engines in the global technology industry.

As corporations and governments race to develop AI systems capable of automating tasks, generating content, and analyzing vast datasets, demand for the computing resources needed to run those models is exploding.

The latest results point to Oracle’s high-stakes gamble — investing billions to become a major provider of AI computing infrastructure — is beginning to deliver tangible financial returns. The company is expected to emerge as one of the most important infrastructure providers in the AI economy if the surge in spending continues.

The race to build the digital infrastructure underpinning the next wave of artificial intelligence, cloud services, and connected devices is pushing U.S. telecom operators into another massive spending cycle.

Walking into the center of that shift is AT&T, which said it plans to invest more than $250 billion in the United States over the next five years to expand its communications networks.

The company also said it will hire thousands of technicians this year to support the build-out and maintenance of its infrastructure, underscoring how telecom providers are scaling operations to keep pace with rapidly rising data consumption.

The investment commitment includes both capital expenditure and broader operational spending aimed at expanding fiber broadband networks, strengthening wireless infrastructure, and developing satellite-enabled connectivity that can extend coverage into remote regions.

AT&T, which employs roughly 110,000 people in the United States, said the new technicians will play a central role in deploying new fiber lines, upgrading 5G infrastructure, and maintaining its nationwide communications systems.

AI, Cloud, and Connected Devices Drive Data Explosion

The spending plan reflects structural changes taking place across the digital economy. The growing use of artificial intelligence tools, cloud computing platforms, and internet-connected devices—from smart home gadgets to industrial sensors—is driving a surge in global data traffic. Telecom operators are therefore under pressure to increase network capacity and speed while maintaining reliability across increasingly complex systems.

For AT&T and its peers, fiber and 5G networks have become critical components of that strategy.

Fiber broadband provides ultra-high-speed connectivity capable of supporting bandwidth-intensive services such as AI-powered applications, video streaming, and cloud computing. Meanwhile, 5G wireless networks are enabling new categories of services, including connected vehicles, industrial automation, and high-speed fixed wireless home internet.

The company said its investment will accelerate the deployment of fiber broadband while also expanding its 5G home internet offering and integrating satellite connectivity to reach underserved areas across urban, suburban, and rural communities.

The new spending pledge builds on a large wave of earlier investment. Between 2019 and 2023, AT&T poured more than $145 billion into upgrading its wireless and wireline networks.

That spending coincided with the nationwide rollout of 5G technology and the expansion of fiber broadband networks capable of delivering multi-gigabit speeds.

The next phase of investment reflects a shift toward networks designed to support the computational demands of artificial intelligence systems and cloud-based services.

Telecom companies are increasingly positioning themselves not just as connectivity providers but as essential infrastructure partners for the digital economy.

AT&T’s investment push is also taking place alongside major federal broadband expansion programs created under the Infrastructure Investment and Jobs Act signed into law in 2021.

The legislation established the $42.5 billion Broadband Equity, Access, and Deployment Program, known as BEAD, which aims to expand high-speed internet access to rural and underserved communities across the United States.

However, the distribution of the funds has been slower than expected. Implementation challenges, regulatory hurdles, and policy changes introduced under the administration of Donald Trump have delayed the rollout of some projects.

Even so, AT&T has emerged as one of the largest beneficiaries of the program. According to analysis from New Street Research, the telecom operator has secured roughly $1.06 billion in BEAD funding for fiber network construction.

The subsidies are intended to encourage private telecom operators to extend broadband coverage to regions where the economics of building infrastructure would otherwise be difficult.

Fiber Becomes A Key Battlefield

The expansion of fiber networks has intensified competition between traditional telecom operators and cable broadband providers.

Cable companies historically dominated the U.S. home broadband market using coaxial cable networks capable of delivering high speeds. But telecom operators have increasingly challenged that dominance by deploying fiber-to-the-home networks that offer faster upload speeds and greater reliability.

One of AT&T’s major rivals, Comcast, is defending its market position through targeted infrastructure upgrades. The company recently launched a $5.9 million network expansion project covering parts of Greater Hartford and Middletown, with completion expected later this year.

At the same time, Verizon Communications has accelerated its fixed broadband strategy following its acquisition of Frontier Communications earlier this year. Verizon is promoting discounted bundled services combining wireless and home internet to attract new subscribers.

These competitive moves highlight how the broadband market has become one of the most fiercely contested segments of the telecommunications industry.

Satellite Partnerships Expand Rural Coverage

AT&T is also exploring new technologies to extend connectivity beyond the reach of traditional infrastructure.

The company has partnered with satellite provider AST SpaceMobile to develop space-based cellular connectivity capable of linking directly with standard smartphones.

Such technology could help deliver mobile service in remote regions where building cell towers or laying fiber cables is impractical or prohibitively expensive.

Danni Hewson, head of financial analysis at AJ Bell, said investors will be watching closely to see how AT&T manages the balance between aggressive spending and financial discipline.

“It has to spend hard, but it also has to spend smart,” Hewson said, noting that the company’s satellite partnership could become a key factor in expanding coverage while controlling costs.

Part of the investment will also go toward strengthening the FirstNet communications network built specifically for emergency responders across the United States.

FirstNet provides dedicated wireless connectivity for police, firefighters and other public safety agencies, ensuring that critical communications remain operational during emergencies or natural disasters.

AT&T said it will also increase investment in cybersecurity infrastructure and artificial intelligence-driven threat detection systems designed to protect its networks from increasingly sophisticated cyberattacks.

A Long-Term Bet On Digital Infrastructure

The scale of AT&T’s planned investment underscores how telecommunications networks are becoming central to the functioning of modern economies.

From AI systems and cloud computing to streaming services and connected devices, the demand for faster and more reliable connectivity continues to expand.

For telecom operators, meeting that demand requires billions of dollars in new infrastructure—creating both opportunities for growth and pressure to manage costs effectively.

AT&T’s $250 billion commitment signals that the next phase of the digital economy will be built not only on software and artificial intelligence, but also on the physical networks capable of carrying the enormous volumes of data those technologies generate.