Following Oracle's release of its earnings forecast, its stock price experienced a remarkable spike, climbing as much as 36% at one juncture. Goldman Sachs has substantially increased its target price for Oracle to $310, while still assigning a 'Neutral' rating.

Oracle's second - quarter results for the fiscal year 2026 revealed a 13% year - on - year revenue growth. However, it fell just short of market expectations by 1%. Gross profit didn't meet projections either, showing a 3% year - on - year decline.

On the bright side, Oracle's management significantly boosted its long - term revenue forecast for the OCI cloud infrastructure business. This move led Goldman Sachs to revise its projections for the IaaS (Infrastructure as a Service) business accordingly.

In terms of remaining performance obligations, the second - quarter figure soared by 359% year - on - year, reaching a staggering $455 billion. This surge underscores the robust customer demand.

Yet, the quarter also saw capital expenditures hit a mind - boggling $21.2 billion. This amount exceeded expectations by 62% and resulted in a 123% deterioration in free cash flow.

In light of these developments, Goldman Sachs has raised its capital expenditure forecasts for the upcoming years. It has also pushed back the break - even point for free cash flow to the fiscal year 2029. Moreover, there remains significant uncertainty regarding whether these massive capital outlays will actually translate into revenue growth.