{"version":1,"type":"story","url":"https://digestai.news/story/microsoft-and-oracle-end-quarter-with-record-backlogs-differing-ai-ris","json":"https://digestai.news/story/microsoft-and-oracle-end-quarter-with-record-backlogs-differing-ai-ris.json","markdown":"https://digestai.news/story/microsoft-and-oracle-end-quarter-with-record-backlogs-differing-ai-ris.md","slug":"microsoft-and-oracle-end-quarter-with-record-backlogs-differing-ai-ris","headline":"Microsoft and Oracle end quarter with record backlogs, differing AI risk profiles","summary":"Microsoft and Oracle both finished their latest quarter with record backlogs, $678B and $664B respectively. Microsoft’s fiscal Q4 revenue reached $90.01B, up 17.8%, and Azure grew 43%. The quarter produced $19.64B in free cash flow, and Copilot passed 30 million paid seats, indicating AI is monetizing in Office and data centers. \n\nOracle’s cloud infrastructure revenue grew 121% and GPU usage hit 97.9%. However, $28.50B of capex turned free cash flow negative at $5.40B, and license revenue fell 15% as older software moves to the cloud. Oracle relies on a few large AI contracts and finished a $20 billion at‑market stock sale.\n\nThe author notes Oracle shares fell 54.35% over the past year, while Microsoft gained 1.59%. Oracle trades at about 18x forward earnings versus 25x for Microsoft, reflecting balance‑sheet risk. The analysis prefers Microsoft for steadier AI exposure due to diversified revenue and positive cash flow.","keyPoints":["Microsoft reported $678B commercial RPO, Oracle $664B, both record backlogs.","Microsoft revenue $90.01B, Azure grew 43%, free cash flow $19.64B; Oracle cloud revenue 121%, capex $28.50B, free cash flow negative $5.40B.","Oracle shares fell 54.35% last year, Microsoft gained 1.59%; Oracle trades at 18x, Microsoft at 25x forward earnings."],"whyItMatters":"The comparison highlights how Microsoft’s diversified revenue and positive cash flow support its AI expansion, while Oracle’s heavy capex and reliance on a few large contracts expose it to higher risk, influencing investor sentiment and future AI infrastructure competition.","category":{"slug":"business","name":"Business & Funding","url":"https://digestai.news/category/business"},"entities":{"companies":["Microsoft","Oracle"],"models":[],"people":["Amy Hood","Hilary Maxson"]},"firstPublishedAt":"2026-10-25T16:45:00Z","updatedAt":"2026-10-25T16:45:00Z","sourceCount":1,"hasPrimarySource":false,"sources":[{"outlet":"247wallst.com","title":"Microsoft Vs. Oracle: Massive Backlog Fortunes With Vastly Different Risk Profiles","url":"https://247wallst.com/investing/2026/10/26/microsoft-vs-oracle-massive-backlog-fortunes-with-vastly-different-risk-profiles","publishedAt":"2026-10-25T16:45:00Z","type":"press","primary":false,"lead":true}],"sourceNotes":null,"discussions":[],"thread":{"title":"Microsoft AI Spending Cuts and Growth Gamble","url":"https://digestai.news/thread/microsoft-directs-azure-software-teams-to-cut-costs-by-20-amid-ai-spending","storyCount":3},"cite":{"text":"Digest AI, \"Microsoft and Oracle end quarter with record backlogs, differing AI risk profiles\", 25 October 2026, https://digestai.news/story/microsoft-and-oracle-end-quarter-with-record-backlogs-differing-ai-ris","publisher":"Digest AI","title":"Microsoft and Oracle end quarter with record backlogs, differing AI risk profiles","datePublished":"2026-10-25T16:45:00Z","url":"https://digestai.news/story/microsoft-and-oracle-end-quarter-with-record-backlogs-differing-ai-ris"},"generatedBy":"Written by Digest AI's editorial model from the linked sources; the sources are the record.","license":"Headlines, digests and key points are written by Digest AI and may be quoted with a link to the story page. Linked articles belong to their publishers. Terms: https://digestai.news/terms#reuse"}