Oracle (ORCL) is seeing its material AI-driven growth acceleration play out, with quarterly positives outweighing the lack of a raised fiscal 2027 revenue guide, UBS said in a note Friday.

The bank cited strong execution, tightly managed opex, and backlog growth from greater customer diversity.

UBS said guidance for continued cloud infrastructure acceleration through fiscal 2027 was a positive surprise, and pointed to reaffirmed fiscal 2027 capex guidance of $90 billion-$95 billion and completion of Oracle's $20 billion ATM/secondary offering as easing credit risk. GPU pricing gains of over 20% on renewals support the view that revenue-per-gigawatt economics may be improving, UBS said.

On the downside, UBS flagged Oracle's reaffirmation, rather than raise, of its $90 billion fiscal 2027 revenue guide, and a wide fiscal second-quarter growth range, as signs of capacity-timing uncertainty.

UBS kept its buy rating on the stock and raised its price target to $250 from $245.

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