Oracle booked $664 billion in future business. Only 13% is expected to turn into revenue over the next year.

OpenAI’s annualized revenue came in at roughly $50 billion, not the $70 billion figure investors had been passing around. The accounting difference explains the gap. But Oracle has a $300 billion computing deal with OpenAI starting in 2027, and its latest filing reveals a number worth watching.

Oracle’s remaining contract backlog reached $664 billion on August 31, up from $455 billion a year earlier. Yet Oracle expects to recognize only about 13% of that backlog as revenue over the next 12 months. The company says the jump came mainly from large cloud contracts signed during the year. Oracle’s quarterly filing

That leaves a lot of promised business waiting to be delivered and paid for. Oracle has to build the capacity first. OpenAI has to grow enough to pay for the computing it has ordered. And the $664 billion backlog is not money Oracle already has.

Now look at what happened this week. The Wall Street Journal reported that Broadcom is seeking more than $50 billion in financing for AI chips being developed with OpenAI. Oracle is separately negotiating financing to buy Nvidia chips, while SpaceX is seeking roughly $40 billion for its own chip purchases. The Wall Street Journal

The companies selling AI computing are now arranging enormous financing deals to obtain the hardware needed to supply it.

Oracle’s $300 billion promise from OpenAI looks very different depending on what happens next: if OpenAI’s revenue keeps climbing, the deal could pay off handsomely. If growth falls short, Oracle will still have expensive infrastructure to finance and a huge customer commitment to fulfill.

The revenue-accounting dispute may be a footnote. Whether the money arrives fast enough to pay for the buildout is not.

Not financial advice.