OCI revenue surges 121% with $664B backlog

Oracle is betting the company on becoming the primary compute backbone for the generative AI era, but astronomical capex creates substantial cash flow risk if cloud margins compress. A $664 billion backlog confirms that major AI labs and enterprises are aggressively booking multi-year cluster capacity on OCI. However, quarterly capex of $28.5 billion eclipses operating cash flow, turning free cash flow negative and raising the stakes for capital efficiency. The central challenge will be scaling physical data centers and power access fast enough to recognize contracted revenue before next-generation hardware cycles render existing builds obsolete.