Customer prepayments covered about 40% of Oracle’s quarterly capex

Oracle reported $28.5 billion in quarterly capital expenditure, with $11.36 billion offset by customer prepayments, according to Reuters. The Information’s accompanying analysis focused on the upfront payments. Oracle maintained its annual spending target while reporting additional AI contracts.

The prepayments were equivalent to about 40% of quarterly capex. That comparison shows their scale, not a complete free-cash-flow reconciliation.

Earlier customer payments reduce what Oracle must finance before service revenue arrives. They do not lower the physical cost of construction. Refund terms, delivery deadlines and compensation for delays determine how much risk travels with the cash.