Oracle (ORCL) is heading into its fiscal Q1 financial results with investors focused on artificial intelligence infrastructure expansion, funding needs, and Stargate uncertainty, RBC Capital Markets said in a note Thursday.

The company is scheduled to report fiscal Q1 earnings on Sept. 10.

Oracle's net cash capital expenditures of about $70 billion in fiscal year 2027, mainly to support its AI infrastructure buildout, is expected to be funded by about $40 billion of debt and equity, while about $75 billion in cumulative BYOH and prepaid contracts are expected to lower the company's financing burden, according to the note.

The Stargate arrangement adds uncertainty, with OpenAI moving from the original joint-venture structure toward bilateral capacity leases, which could change Oracle's ownership and financing obligations, the investment firm said.

The company has been using cost savings from headcount reductions to help fund its AI infrastructure buildout, analysts said, adding that while cost reallocation is more favorable than taking on additional debt or issuing equity, repeated layoffs could create execution risk.

RBC Capital Markets has a sector perform rating and $190 price target on Oracle.

Shares of Oracle were up more than 2% in Friday trading.

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