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Written by Catie Hogan for The Motley Fool->
Oracle has a $300 billion partnership with OpenAI.
Oracle's stock is down over 12% in 2026.
The software and cloud infrastructure company's backlog grew to $553 billion as of its latest quarter.
OpenAI, the revolutionary artificial intelligence company co-founded by Sam Altman, sent shivers down investors' spines recently after reportedly missing user growth and revenue targets. This had ripple effects across the broader tech sector and raised concerns about whether OpenAI can sustain its data center commitments and whether its high-profile partnerships will deliver on their promises.
Oracle (NYSE: ORCL), which has a $300 billion multiyear partnership with OpenAI, dropped about 4% on the news. Does this mean Oracle investors should panic? Absolutely not. Oracle's cloud infrastructure, software, and database business lines are vast and not completely reliant upon OpenAI.
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Oracle's financials are quite strong. First, the company's remaining performance obligations (RPOs) totaled $553 billion as of the third quarter of fiscal 2026. This is a 325% year-over-year increase. There is no shortage of demand for Oracle's software and services.
Second, earnings per share increased by 24%, and total revenue rose by 22%. Oracle's stock is down year to date, but over the past five years has increased 126%, well outpacing the S&P 500.
Oracle's fundamentals are fully intact and not fully correlated with OpenAI. The lesson is that investors shouldn't have an emotional reaction to every headline-catching promise or short-term disappointment. Buy Oracle for the long term, ignore the noise. If anything, the pullback in share price on the OpenAI news might create a better entry point to buy Oracle.
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Catie Hogan has positions in Oracle. The Motley Fool has positions in and recommends Oracle. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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