TLDR: Oracle’s recent fiscal Q1 2026 earnings report revealed a record $455 billion in remaining performance obligations (RPO), largely fueled by strong demand for AI-related cloud infrastructure. This significant forecast, particularly for Oracle Cloud Infrastructure (OCI), underscores a sustained growth trajectory for AI adoption. Palantir, through its existing partnership with Oracle, is strategically positioned to capitalize on this expansion, as its AI Platform (AIP) becomes accessible to a broader base of enterprise users. This development is expected to drive Palantir’s AI-centric revenue growth, despite its high valuation, confirming a long-term runway for the AI revolution.
Oracle has delivered compelling evidence that the artificial intelligence (AI) revolution is continuing its strong growth, providing positive news for Palantir Technologies investors. Following its fiscal 2026 first-quarter report (ended August 31), Oracle announced revenues of $14.9 billion, a 12% year-over-year increase, with adjusted earnings per share (EPS) rising 6% to $1.47. While these figures slightly missed Wall Street’s consensus estimates of $15 billion in revenue and $1.48 EPS, they marked an acceleration from the previous quarter.
The most striking revelation was the surge in Oracle’s remaining performance obligation (RPO), which represents contractually obligated sales not yet recognized as revenue. This figure dramatically increased by 359% to an unprecedented $455 billion. Oracle CEO Safra Catz highlighted this growth, stating, “We signed four multibillion-dollar contracts with three different customers in Q1.” She further anticipated signing “several additional multibillion-dollar customers,” projecting RPO to “exceed half a trillion dollars,” with much of this driven by “robust demand for AI.”
Oracle Cloud Infrastructure (OCI), previously a smaller player in the cloud market, is poised for significant expansion. In the second calendar quarter of 2025, OCI held only 3% of the cloud infrastructure market, trailing Amazon Web Services (30%), Microsoft Azure (20%), and Google Cloud (13%). However, Oracle’s long-term cloud revenue guidance paints a different picture:
Fiscal 2026 cloud revenue: $18 billion (up 77%)
Fiscal 2027 cloud revenue: $32 billion (up 78%)
Fiscal 2028 cloud revenue: $73 billion (up 128%)
Fiscal 2029 cloud revenue: $144 billion (up 97%)
Oracle executives confirmed that the majority of this projected revenue is already secured within the reported RPO, indicating that future deals will further enhance this impressive outlook. This positions OCI to become a major force in the cloud infrastructure market.
This development has direct implications for Palantir. The two companies established a comprehensive partnership last year, which involved Palantir migrating its Foundry workloads to Oracle Cloud. Crucially, Palantir’s Gotham and Artificial Intelligence Platform (AIP) – its generative AI offering – became deployable across Oracle’s distributed cloud. AIP has been a primary growth driver for Palantir, with its U.S. commercial segment (which includes AIP) growing 93% year over year and 20% quarter over quarter in Q2, as enterprises rapidly adopt AI tools for proven return on investment.
Oracle’s plan to expand its cloud footprint more than sevenfold over the next five years creates a substantial pool of potential new customers for Palantir. Palantir also offers “boot camps” where developers collaborate with its engineers to build real-world solutions using AIP, which is deeply integrated into customer systems to provide actionable insights in real time.
Also Read:
- Oracle’s Cloud Infrastructure Poised for Explosive Growth, Projecting $144 Billion Annually
- Adobe Reports Strong Q3 FY2025 Earnings, Elevates Full-Year Outlook Driven by AI Innovation
Despite the promising outlook, Palantir’s stock remains highly valued, trading at 196 times next year’s expected earnings. While this valuation may deter some investors, the stock’s recent decline offers a more accessible entry point than in previous weeks.
