Oracle Q2 2026: Cloud Growth Soars Amid Massive Spending and One-Time Gain

Oracle, a cornerstone of enterprise software, is in the midst of a high-stakes pivot to cloud computing. To gauge its progress, let's unpack the numbers from its latest 10-Q filing for the quarter ending November 30, 2025. The report highlights accelerating cloud growth fueled by massive infrastructure spending, alongside a bottom line dramatically inflated by a notable one-time gain.

The Cloud Infrastructure Gold Rush

The most significant trend in Oracle's performance is the continued surge in its cloud business. Total cloud revenue for the quarter reached $8.0 billion, a robust 34% increase from $5.9 billion in the same period last year.

Digging deeper, the real engine of this growth is Cloud Infrastructure, which soared an impressive 68% year-over-year to $4.1 billion. This segment, which provides core computing, storage, and networking services, is where Oracle is fiercely competing with giants like Amazon Web Services and Microsoft Azure. Cloud Applications, which includes its well-known Fusion and NetSuite enterprise resource planning (ERP) software, also grew a healthy 11% to $3.9 billion.

This shift is starkly contrasted with the decline in its legacy business. Revenue from traditional Software Licenses fell 21%, a clear indicator that customers are increasingly choosing subscription-based cloud models over perpetual, on-premise software.

Profitability and a Multi-Billion Dollar Boost

Oracle's total revenue for the quarter grew 14% to $16.1 billion. The following flow diagram offers a visual breakdown of where this revenue came from and how it was allocated across various costs to arrive at the final net income.

While operating income grew a respectable 12% to $4.7 billion, the company's net income nearly doubled to an eye-popping $6.1 billion. The source of this windfall wasn't core operations, but rather a $2.5 billion gain from "marketable and non-marketable investments." The filing's notes attribute this primarily to the sale of investments in chip designer Ampere Computing. This is a crucial detail for investors, as this one-time event significantly skews the underlying profitability of the business for the quarter.

Investing Heavily in Future Growth

Oracle is putting its money where its mouth is. The company's capital expenditures—cash spent on property, plant, and equipment—hit a staggering $20.5 billion for the first six months of the fiscal year. This is a more than threefold increase from the $6.3 billion spent in the same period last year.

The report states this cash is being used "primarily due to the expansion of our data centers." Oracle is in a full-scale construction phase, building out the global capacity needed to power its cloud ambitions. This aggressive investment strategy is a necessary move to keep pace with customer demand and competitors. To help fuel this growth, the company also raised $18.0 billion in new debt in September 2025.

Final Thoughts

Oracle's latest report demonstrates that its strategic focus on cloud infrastructure is paying off, driving strong top-line growth. The company is backing this strategy with immense capital investment, signaling its commitment to winning in a market dominated by well-entrenched players. While the stellar net income this quarter was largely the result of a profitable investment sale, the underlying story is one of a company in a phase of aggressive, capital-intensive expansion. Oracle is betting big that today's spending will secure its place as a top-tier cloud provider for years to come.