Dive Brief:
- Oracle surpassed a major threshold in its transformation, as cloud-based infrastructure and software services became the company's dominant business segment during the three-month period ending Feb. 29, according to the company's Q3 2024 earnings report.
- “This quarter marks the first time our total cloud revenue is more than our total license support revenue," CEO Safra Catz said during a Monday earnings call. "We have crossed over."
- The company reported $5.1 billion in cloud revenue, up 24% year over year, and a 49% spike in infrastructure cloud services revenue. “If not for some continuing supply constraints, consumption growth would have been even higher,” Catz said. License support revenue was $4.9 billion for the quarter.
Dive Insight:
A dominant force in ERP and database, Oracle remains a junior member of the hyperscaler club. Its quarterly cloud revenues were dwarfed by the nearly $25 billion AWS reported in February.
But Oracle’s footprint is expanding as enterprise cloud spend rockets toward $700 billion this year, growing more than 20% year over year, Gartner forecasts.
Chairman and CTO Larry Ellison promised more cloud capacity to satisfy a demand backlog during a December earnings call. Catz put a number behind the promise Monday, pledging to spend $10 billion to build out data capacity in the next year.
“We're building an AI data center in the United States where you can park eight Boeing 747s nose to tail," Ellison said, referencing a Salt Lake City facility currently under construction.
The company currently has 68 customer-facing regions, two of which became operational in the first months of the year, along with 47 public cloud regions and another eight in the building phase, Catz said Monday. Twelve of the public cloud regions interconnect with Azure, as part of a multicloud alliance broadened last year.
The Microsoft partnership was recently extended to include three more data centers, bringing the total number planned to 20, Ellison said, adding there are “other multicloud agreements that are being signed.”
