Oracle has taken a significant step in its artificial intelligence strategy by introducing an outcome-based billing model, moving away from the traditional token-based pricing. This move, announced during the presentation of its financial results for the fourth quarter and fiscal year 2026, reflects the growing business demand for AI solutions that offer tangible and predictable value.

Record financial results and cloud bet

The company reported total revenues of $67.4 billion, up 17% year-over-year, and net income of $17.087 billion, an increase of 36%. CFO Hilary Maxson highlighted that cloud infrastructure revenues grew 93% year-over-year, driven by demand for AI workloads and database services. To sustain this growth, Oracle plans to invest over $70 billion in capital expenditure next year, based on customer commitments.

CEO Mike Sicilia explained that customers are looking for ways to leverage AI to increase productivity, improve customer service, and generate competitive advantages. "They want to do it quickly and within their current budget," he said. Oracle has already deployed over 1,000 AI agents in its application suites, capable of reasoning, deciding, and executing tasks across processes. This approach has led to a pilot outcome-based billing program launched last quarter with 33 organizations.

The end of token economics?

Sanchit Vir Gogia, chief analyst at Greyhound Research, warns that this move does not mean the disappearance of tokens. "Tokens are not disappearing; they are being hidden behind a more business-friendly interface. The counter is still running somewhere," he notes. Token-based pricing is difficult for companies to budget, as agent workloads can consume up to a thousand times more tokens than simple tasks, with variations of up to thirty times in identical executions.

Oracle's advantage, according to Gogia, lies in its proximity to the system of record, allowing it to define outcomes more credibly than other providers. However, the danger is that the provider becomes both supplier and arbiter. "This is an industry-wide rethink, and the destination is hybrid pricing," he adds. Tokens will remain in the underlying layer, even if they disappear from the invoice.

Implications for CIOs

Scott Bickley, advisor at Info-Tech Research Group, believes this model is where CIOs want to go, as it makes it easier to define business value. Currently, variable consumption licensing models are a black box that is hard to understand. SaaS providers have tried to abstract tokens into AI work units, credits, or actions, but still require understanding the underlying mechanics. "If you can completely abstract that pain and offer me an outcome for a price, then you are way ahead of most of the market," Bickley says.

Gogia advises CIOs to separate the construction impulse from execution certainty, as the real bottleneck in AI is no longer GPUs but energy, permits, and policy. Additionally, Oracle's results are not just about AI infrastructure but also its attempt to become harder to avoid in a multi-cloud world, as reflected in database figures.

This paradigm shift in AI billing aligns with broader industry trends where transparency and measurable value are increasingly demanded. For companies, adopting models like Oracle's can simplify AI adoption but requires careful evaluation of the risks of relying on a single provider as the arbiter of value. At ForgeNEX, we have analyzed how strategic consulting can help organizations navigate these changes, and how solutions like Microsoft Azure offer alternatives in the cloud ecosystem.

Ultimately, Oracle is redefining the rules of the game in AI monetization, but success will depend on its ability to maintain trust and transparency in an increasingly competitive market.

Original source: ComputerWorld. Analysis and adaptation by ForgeNEX.