Microsoft vs Oracle Stock: How the Two AI Cloud Bets Differ

Training and running AI takes huge data centers, and only a few companies can build them fast enough. The labs that need them sign long contracts for the space, and the builders borrow, spend and hire years before that money comes in.

Two companies can sell the same computing to the same customer and still be very different bets. One may pay for its buildings with cash from its other businesses, while the other pays with new loans and new shares. When that happens, the same news can hit the two share prices very differently.

So it helps to compare two cloud stocks by how they work, not just by how fast they grow. That means what each one sells, how much future business it has signed, how it pays for the build, and how its shares have moved.

Microsoft and Oracle are two of those builders, and both sell computing to OpenAI. On BloFin, Microsoft (MSFT) can be traded through the MSFTUSDT Perpetual, where gains and losses are counted in USDT and no actual shares change hands.

What is the difference between Microsoft and Oracle stock?

Microsoft and Oracle stock are both shares in big cloud businesses, but Microsoft is far larger. It took in $92.3 billion of revenue in its latest quarter (source: Microsoft Q1 FY2027 results), against Oracle's $19.3 billion (source: Oracle Q1 FY2027 results). Oracle is growing faster, at 30% against 19% (source: Oracle Q1 FY2027 results) (source: Microsoft Q1 FY2027 results). Microsoft pays for its data centers from its own cash, while Oracle also borrows and sells new shares.

Each company calls its latest quarter the first quarter of fiscal 2027, but the two cover different months. For Microsoft it is July to September 2026, and for Oracle it is June to August 2026. Microsoft's shares trade on the Nasdaq (source: Microsoft Q1 FY2027 Form 10-Q), and Oracle (ORCL) trades on the New York Stock Exchange (source: Oracle Investor Day release).

All of these figures come from the two companies' quarterly results (source: Microsoft Q1 FY2027 results) (source: Oracle Q1 FY2027 results). Operating margin is operating income divided by revenue. Free cash flow is the cash from running the business minus the cash spent on property and equipment, and both companies report it on that basis.

For a shareholder, the gap in cash and borrowing matters more than the gap in growth. Microsoft's revenue is 4.8 times Oracle's, yet the two have signed up almost the same amount of future business. That makes Oracle's contracts huge for a company its size. Oracle also spent more on equipment than its business brought in, and it owes more than three times as much as Microsoft at about a tenth of the market value. Those facts help explain why the two shares have moved so differently, and Microsoft's price history and cycles give the longer view.

Matching Microsoft's and Oracle's fiscal years

Microsoft's fiscal year ends on June 30 and Oracle's ends on May 31, so their quarters run one month apart. Fiscal 2027's first quarter is July to September 2026 at Microsoft and June to August 2026 at Oracle. The two share July and August, and each one includes a month the other leaves out.

A gap of one month is small, so the two can be compared quarter by quarter and year by year without much distortion. The full years tell the same story as the latest quarters. In fiscal 2026, Microsoft took in $331.8 billion of revenue and kept 46.8% of it as operating income (source: Microsoft Q4 FY2026 results). Oracle took in $67.4 billion and kept 30.6% (source: Oracle Q4 and FY2026 results).

The calendar also decides when news comes out. Oracle's results for June to August came out on September 10, about seven weeks before Microsoft's. Oracle's September and December reports are often the first fresh sign of cloud demand that a Microsoft holder sees each season.

What Microsoft and Oracle sell

Microsoft sells cloud computing, business software and consumer products, and it reports them in two parts, the Agents and Infra segment and the Devices and Consumer segment. Oracle sells cloud services, software, hardware and services. In their latest quarters, the Agents and Infra segment made up 83.2% of Microsoft's revenue, and cloud made up 60.0% of Oracle's (source: Microsoft Q1 FY2027 results) (source: Oracle Q1 FY2027 results).

Microsoft's figures cover July to September 2026, and Oracle's cover June to August 2026 (source: Microsoft Q1 FY2027 results) (source: Oracle Q1 FY2027 results).

The Agents and Infra segment holds Microsoft's cloud services, including Azure, and its business software, and it grew 25% in the quarter. The Devices and Consumer segment holds Windows, Xbox and ads, and it shrank 3% (source: Microsoft Q1 FY2027 results). The company moved to these two segments in September 2026, and BloFin's breakdown of Microsoft's revenue walks through each line.

Oracle's growth comes almost all from the computing it rents out as Oracle Cloud Infrastructure, or OCI. That line grew 121%, while cloud applications grew 10%. Software licenses and support, the database business Oracle was built on, fell 3% (source: Oracle Q1 FY2027 results). So Oracle is really two businesses at once: an older software business that is shrinking slowly, and a computing business that more than doubled in a year.

Oracle as Microsoft's rival and partner

In its annual report for the year to May 2026, Oracle names Microsoft as one of the companies it competes with head to head (source: Oracle FY2026 Form 10-K). The two also work together. Oracle runs its database services inside Microsoft's Azure data centers, so a customer can use Oracle's database next to Azure's other services.

The filing lists nine large rivals, and Microsoft sits on that list next to Alphabet, Amazon, IBM and SAP (source: Oracle FY2026 Form 10-K).

The partnership is just as real. Under a service called Oracle AI Database@Azure, "Oracle will build, deploy, and operate a set of Oracle AI Database Services in Azure" (source: Microsoft Azure, Oracle on Azure). Before that, those services ran only in clients' own buildings or in OCI. Oracle's filing adds that OCI works with Azure, Amazon Web Services and Google Cloud (source: Oracle FY2026 Form 10-K).

For a shareholder, the overlap cuts both ways. A big customer that moves its Oracle databases onto Azure can add revenue at both companies at once. That is one reason news about a single cloud budget can move both stocks.

Two cloud suppliers to OpenAI

Microsoft and Oracle both rent computing to OpenAI, the maker of ChatGPT. Microsoft owns about 24% of OpenAI and took in $10.0 billion from it in July to September 2026 (source: Microsoft Q1 FY2027 Form 10-Q). Oracle has agreed to develop 4.5 gigawatts of data center space for OpenAI (source: OpenAI), but its annual and quarterly reports do not say how big a customer OpenAI is.

Microsoft's tie runs deeper because it is also an owner. Its quarterly report describes a stake of about 24% if all of its holdings were turned into common shares. The $10.0 billion of OpenAI revenue was 10.8% of Microsoft's total for the quarter (source: Microsoft Q1 FY2027 Form 10-Q). BloFin's guide to Microsoft's OpenAI stake covers the holding itself and how Microsoft accounts for it.

In October 2025 the two companies reset their deal. Under the new terms, OpenAI committed $250 billion more to Azure, while Microsoft no longer holds a right of first refusal over OpenAI's computing (source: Microsoft Official Blog). OpenAI's 4.5-gigawatt agreement with Oracle came three months before that change, in July 2025.

Oracle's role is to build the data centers. On July 22, 2025, OpenAI said that it and Oracle would build 4.5 gigawatts of extra Stargate data center space in the US (source: OpenAI). That comes on top of the first Stargate site in Abilene, Texas. Oracle's annual and quarterly reports do not name OpenAI, but its annual report warns that some OCI offerings are "more concentrated among a number of large customers" (source: Oracle FY2026 Form 10-K). So OpenAI's ability to keep paying matters to both stocks, and much more to the smaller one.

Remaining performance obligations compared

Remaining performance obligations, or RPO, are revenue a company has signed for but not yet delivered. Oracle's RPO was $664 billion at August 31, 2026, about 34 times its latest quarter's revenue (source: Oracle Q1 FY2027 Form 10-Q). Microsoft's commercial RPO was $677 billion at September 30, 2026, about seven times its quarter's revenue (source: Microsoft Q1 FY2027 results).

Oracle's backlog also sits further in the future. Oracle expects to turn about 13% of its $664 billion into revenue in the next twelve months, or about $86.3 billion. It expects 37% in months 13 to 36, 34% in months 37 to 60 and the last 16% after that (source: Oracle Q1 FY2027 Form 10-Q). Microsoft expects about 30% of its commercial RPO in the next twelve months, about $203.1 billion. It says the backlog has a weighted average length of 2.3 years (source: Microsoft Q1 FY2027 earnings call).

Microsoft's backlog is counted at September 30, 2026 and Oracle's at August 31, 2026 (source: Microsoft Q1 FY2027 results) (source: Oracle Q1 FY2027 Form 10-Q). The twelve-month dollar amounts apply each company's own share to its backlog.

A backlog is a promise. It is only worth something if the customer pays and the seller builds the space on time. Oracle's sits further out and, by its own account, with fewer large customers.

Capital spending and free cash flow

Oracle spent $28.5 billion on buildings and equipment in June to August 2026, or 147.3% of its revenue. It ended the quarter with free cash flow of minus $5.4 billion. Microsoft spent $39.4 billion in cash on the same things in July to September 2026, about 42.7% of its revenue, and kept $18.6 billion of free cash flow (source: Oracle Q1 FY2027 results) (source: Microsoft Q1 FY2027 results).

Free cash flow is what is left of that cash once equipment is paid for, and this is where the two companies differ most. Oracle's cash from running the business was $23.1 billion. But that included $11.4 billion of customer prepayments, which is money paid in advance for capacity Oracle has yet to deliver (source: Oracle Q1 FY2027 results). Take those prepayments out and the quarter's free cash flow is about minus $16.8 billion. Oracle's own extra measure counts them against the build instead. It takes the prepayments off capital spending, adjusts for one smaller financing item, and puts the quarter's net cash outlay for the build at $18.0 billion (source: Oracle Q1 FY2027 results).

Microsoft's own figure for capital spending was higher, at $45.2 billion or about 49.0% of revenue, because it also counts data centers it leases (source: Microsoft Q1 FY2027 earnings call). Even so, the $58.0 billion of cash its business brought in covered the spending with room to spare (source: Microsoft Q1 FY2027 results).

The full fiscal years show the same pattern on a larger scale. Oracle's free cash flow for the year to May 2026 was minus $23.7 billion, on $55.7 billion of capital spending (source: Oracle Q4 and FY2026 results). Microsoft's for the year to June 2026 was $67.0 billion, on $115.9 billion of spending (source: Microsoft Q4 FY2026 results). Both are building at a record pace, but only one of them pays for it with the cash its customers send in. BloFin's explainer on Microsoft's AI capex shows where its spending goes.

Debt and credit ratings

Oracle had $125.3 billion of notes and other borrowings at August 31, 2026, and held $37.1 billion of cash and marketable securities. Microsoft had $35.5 billion of debt at September 30, 2026, and held $64.5 billion of cash and short-term investments (source: Oracle Q1 FY2027 results) (source: Microsoft Q1 FY2027 results).

Put another way, Oracle owed about $88.3 billion more than the cash it held, while Microsoft held about $29.0 billion more cash than debt. Debt also costs money to carry. Oracle's interest expense was $1.4 billion in the quarter, equal to 21.2% of its operating income (source: Oracle Q1 FY2027 results).

The credit ratings follow that gap. Microsoft's quarterly report gives its long-term debt rating as AAA (source: Microsoft Q1 FY2027 Form 10-Q). S&P Global rates only two US public companies AAA, Microsoft and Johnson & Johnson, one notch above the US government itself (source: 247 Wall St.). S&P Global Ratings cut Oracle from a BBB to a BBB-, its lowest investment-grade rating, on July 9, 2026, Wisconsin Watch reported (source: Wisconsin Watch). Moody's rated Oracle Baa2 with a negative outlook in December 2025 (source: Moody's). Oracle's annual report warns that a rating change could lower the value of its debt and its shares and raise the interest it pays (source: Oracle FY2026 Form 10-K).

Oracle has also raised money by selling new shares. It sold $20 billion of stock through an at-the-market program in June to August 2026, which means issuing new shares into the market a little at a time (source: Oracle Q1 FY2027 results). Oracle's average share count was 5.0% higher than a year earlier, while Microsoft's was 0.1% lower (source: Oracle Q1 FY2027 results) (source: Microsoft Q1 FY2027 results). So each Oracle share stood for a thinner slice of the business than a year earlier.

October 28, 2026: Oracle's Investor Day and Microsoft's report

On October 28, 2026, Oracle held its Investor Day, and Microsoft reported its July to September quarter after the market closed. Oracle said it expects free cash flow to turn positive in the second half of fiscal 2028. It also capped new money raised through fiscal 2030 at $20 billion (source: Oracle Investor Day release). Its shares rose 10.7% that day (source: Nasdaq, ORCL historical data).

The cap was aimed at worries about Oracle's debt. Oracle split it between $10 billion of shares and $10 billion of debt, not counting the refinancing of old debt. That cap comes on top of the $20 billion share sale it finished in June to August 2026. It said capital spending would peak in fiscal 2027 and 2028 and then step down in fiscal 2029. It also listed keeping investment-grade credit ratings first among its priorities for its cash (source: Oracle Investor Day release). These are Oracle's own plans, and the company itself says they may not be met.

The first jump did not last. Oracle's shares closed up 10.7% on October 28, then fell 3.4% on October 29 and 6.4% on October 30. That left them 0.1% above the October 27 close by the end of the week (source: Nasdaq, ORCL historical data).

Microsoft's report led to a much smaller move. Its shares fell 0.2% on October 29, the first session after the release, and 1.8% from the October 27 close to October 30 (source: Nasdaq, MSFT historical data). In the same week, news moved one stock by more than 10% in a day and the other by less than 2% in any session. That is typical of how differently the two shares trade.

Share price returns and volatility

Across the twelve months to October 30, 2026, Microsoft's shares were flat once dividends are added, at 0.0%, while Oracle's lost 48.4% (source: Nasdaq, MSFT historical data) (source: Nasdaq, ORCL historical data). Oracle's daily moves were also far bigger. Its annualized volatility was 58.2% against 32.8%, and it moved more than 5% in a day 37 times, against four times for Microsoft.

Returns use Nasdaq's daily closing prices (source: Nasdaq, MSFT historical data) (source: Nasdaq, ORCL historical data). "With dividends" adds each dividend with an ex-dividend date in the window, but does not reinvest it. Oracle's dividend dates come from its payment record (source: Stock Analysis, ORCL dividends).

Annualized volatility measures how widely daily returns, each day's percentage change in the close, spread out over a year. It shows how far a share tends to swing, not which way. Both figures use the 251 daily returns in the year to October 30, 2026. Over that year, the two stocks' daily returns had a correlation of 0.46, so they often moved the same way on the same day, but far from always.

Oracle's swings have gone both ways. On September 10, 2025, the day after Oracle reported $455 billion of RPO, its shares rose 35.9% to $328.33, their highest close in the two years (source: Oracle Q1 FY2026 results) (source: Nasdaq, ORCL historical data). By July 24, 2026, they had closed at $114.99, 65.0% below that high, and on October 30 they were still 60.2% below it. Microsoft's biggest one-day move in the two years was a 15.5% rise on July 30, 2026. Its October 30 close was 4.0% below its highest close of the two years, set on October 13 (source: Nasdaq, MSFT historical data).

Swings that size matter most on a leveraged trade, where one bad day can wipe out the margin behind it. On BloFin, the MSFTUSDT Perpetual page shows Microsoft's price as it moves, along with the funding rate and the mark price that drives liquidation.

Valuation and dividends

At the October 30, 2026 close, Microsoft was worth about $3.9 trillion and Oracle about $395.1 billion, so the larger one is roughly ten times the size. Microsoft traded at 27.2 times its last four quarters of earnings and Oracle at 20.5 times. Oracle's dividend yield was 1.53%, about twice Microsoft's 0.75% (source: Oracle Q1 FY2027 results) (source: Microsoft Q1 FY2027 Form 10-Q).

Share counts are from each latest quarterly report, and the ratios use them with the Nasdaq close (source: Microsoft Q1 FY2027 Form 10-Q) (source: Oracle Q1 FY2027 Form 10-Q) (source: Nasdaq, MSFT historical data) (source: Nasdaq, ORCL historical data).

Trailing earnings are the last four reported quarters added up, so the two windows end a month apart, at September 30 and August 31, 2026. Both totals also hold a large one-off gain. Microsoft's includes $1.02 a share of net gains on its OpenAI stake from October to December 2025 (source: Microsoft Q2 FY2026 results). Oracle's includes a $2.7 billion pre-tax gain from selling its stake in the chip maker Ampere in September to November 2025 (source: Oracle Q2 FY2026 results). Without those gains, both multiples would be higher. A lower multiple usually means buyers pay less for each dollar of profit because they see more risk in it. For Oracle, the measures that stand out are negative free cash flow, heavy borrowing and a backlog that leans on a few large customers. Microsoft's valuation measures set its own multiple against a wider group of peers.

Oracle pays the higher yield while its free cash flow is below zero. It paid $1.6 billion of dividends in June to August 2026, the same quarter it raised $19.9 billion from its share sale (source: Oracle Q1 FY2027 results). Microsoft declared $7.3 billion of dividends in July to September 2026, a quarter when its free cash flow was $18.6 billion (source: Microsoft Q1 FY2027 Form 10-Q).

Trading Microsoft and Oracle on BloFin

BloFin lists both companies as perpetual contracts settled in USDT. The MSFTUSDT Perpetual has traded since April 20, 2026 and the ORCLUSDT Perpetual since May 6, 2026. Each contract equals 0.01 of a share, allows up to 20 times leverage and never expires. Neither pays a dividend or gives a shareholder vote.

The two contracts have the same main terms: a 0.01 tick size, a minimum order of 0.01 of a share and funding normally settled every eight hours (source: BloFin, ORCLUSDT contract information) (source: BloFin, MSFTUSDT contract information). Funding is a regular payment between buyers and sellers that pulls the contract's price toward the share price. BloFin's guide to crypto funding rates explains how it is set, and BloFin notes that it may adjust contract terms as markets change.

The gap in volatility matters most on these contracts, because leverage makes every move bigger. Oracle's big daily moves came far more often than Microsoft's in the year to October 30, 2026, and each one would hit a leveraged position hard. So the same leverage carries far more risk of liquidation on the Oracle contract. Both contracts follow BloFin's stock futures hours, and the guide to the MSFT perpetual's trading hours shows when orders may be limited to reduce-only.

Both perpetuals settle in the same USDT balance. So some traders buy one and sell the other, to bet on one company doing better than the other rather than on the market. BloFin's guide to Microsoft pair trades covers how such a position is sized and what it costs to hold.

Looking to trade Microsoft? To get started, you'll need to first create a BloFin account, fund your account with cryptocurrency, and go to the MSFTUSDT Perpetual trading page.

Frequently asked questions

Is Microsoft bigger than Oracle?

Microsoft is much bigger by revenue and by market value, but the gap in staff is far smaller. It took in $92.3 billion of revenue in July to September 2026, against Oracle's $19.3 billion in June to August 2026 (source: Microsoft Q1 FY2027 results) (source: Oracle Q1 FY2027 results). At the October 30, 2026 close it was worth about ten times as much (source: Nasdaq, MSFT historical data) (source: Nasdaq, ORCL historical data). Yet Microsoft employed about 223,000 people full-time at June 30, 2026 (source: Microsoft FY2026 Form 10-K), against Oracle's about 141,000 at May 31, 2026 (source: Oracle FY2026 Form 10-K).

Is Oracle a Microsoft competitor?

Oracle is a rival and a partner at the same time, and it names a risk in the partnership itself. Its annual report lists Microsoft among the companies it competes with directly. It also warns that because its cloud works with Azure and other rival clouds, customers could move work to those rivals or buy fewer Oracle products (source: Oracle FY2026 Form 10-K).

Why did Oracle stock jump in September 2025?

Oracle shares rose 35.9% on September 10, 2025, the session after it reported $455 billion of remaining performance obligations, up 359% from a year earlier. Oracle said it had signed four contracts worth billions of dollars each with three different customers in that quarter (source: Oracle Q1 FY2026 results). That close of $328.33 was Oracle's highest in the two years to October 2026 (source: Nasdaq, ORCL historical data).

When does Oracle report its next quarter?

Oracle's second quarter of fiscal 2027 covers September to November 2026. It released its second-quarter results on December 9, 2024 and on December 10, 2025, both in the second week of December, in filings with the US Securities and Exchange Commission. Its reports can move the shares sharply, as on December 11, 2025, when they fell 10.8% (source: Nasdaq, ORCL historical data).

Do Microsoft and Oracle both pay dividends?

Both pay a dividend every quarter, and Oracle raised its payment from $0.40 to $0.50 a share in 2025 (source: Stock Analysis, ORCL dividends). It paid its latest $0.50 on October 23, 2026 (source: Oracle Q1 FY2027 results). Microsoft raised its dividend from $0.91 to $0.98 in September 2026, payable on December 10, 2026 to holders of record on November 19 (source: Microsoft Q1 FY2027 Form 10-Q). Holders of the perpetual contracts receive neither dividend.

Researched and written by the BloFin Academy editorial team with AI-assisted drafting. All facts independently verified. Primary sources include both companies' results and filings, Microsoft's call, blog and Azure page, Oracle's Investor Day release, OpenAI, Nasdaq, Stock Analysis, Wisconsin Watch, 247 Wall St., Moody's and BloFin's contract pages, current as of November 2, 2026.

Nothing in this article constitutes financial advice. It does not say which share is better to hold, predict either company's results or share price, or tell you to buy, sell or hold either one. Oracle's backlog rests on a few large customers paying for space it is still building with borrowed money and new shares. One contract or rating change can move its shares by double digits in a day. Oracle's own plans may not be met, and a leveraged position in either perpetual can be wiped out by one session's move. Past performance does not indicate future results. Do your own research and consider your risk tolerance before you trade on BloFin.