maybefalse/iStock Editorial via Getty Images I assigned a ‘Sell' rating to Oracle (NYSE:ORCL) in my article published in January 2024, arguing that the company is losing strength in cloud and AI. Oracle released its Q1 FY25 result on September 9th after the bell, reporting 8% growth in revenue and 17% increase in EPS. While I think Oracle’s partnership with Amazon (AMZN) is quite positive for the growth of Oracle’s Autonomous database, I am still concerned about their legacy business including hardware, ...

Financial Data and Key Metrics - Total revenue for Q1 was $13.3 billion, up 8% YoY [10] - Cloud revenue (SaaS and IaaS) grew 22% to $5.6 billion, with SaaS revenue at $3.5 billion (up 10%) and IaaS revenue at $2.2 billion (up 46%) [9] - Non-GAAP EPS was $1.39, up 17% in USD and 18% in constant currency [11] - Operating cash flow for Q1 was $7.4 billion, with free cash flow at $5.1 billion [12] - Remaining Performance Obligations (RPO) grew 52% in constant currency to $99 billion, with cloud RPO representing nearly three-fourths of total RPO [13] Business Line Performance - Strategic back-office SaaS applications grew 18% with annualized revenues of $8.2 billion [9] - Infrastructure cloud services revenue grew 46%, with OCI consumption revenue up 56% [10] - Cloud database services grew 23%, with annualized revenues of $2.1 billion [10] - Software license revenues increased 8% to $870 million, including strong growth in Java [10] Market Performance - The company has 85 cloud regions live, with 77 more planned, including public, dedicated, national security, sovereign, and multi-cloud regions [14] - Multi-cloud agreements with AWS, Microsoft Azure, and Google Cloud are expected to accelerate database growth in public clouds [21][44] Strategic Direction and Industry Competition - The company is expanding OCI capacity to meet demand, with CapEx expected to double in FY2025 compared to FY2024 [14][16] - Oracle's multi-cloud strategy is expected to drive growth, particularly for the Oracle Database, which is now available on AWS, Azure, and Google Cloud [8][21] - The company is focusing on AI-driven applications, with autonomous databases and AI agents integrated into its products to enhance productivity and efficiency [7][27] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in double-digit revenue growth for FY2025, with cloud infrastructure revenue expected to grow faster than last year [16] - The company highlighted the importance of automation and security in its cloud services, with autonomous databases reducing human labor and improving margins [27][30] - Oracle is investing heavily in AI training and inferencing, with plans to build gigawatt-scale data centers to support large AI models [19][35] Other Key Information - The company repurchased 1.1 million shares for $150 million and paid out $4.4 billion in dividends over the last 12 months [15] - Oracle is eliminating passwords in favor of biometric authentication and introducing Zero Trust Packet Routing to enhance security [62][63] Q&A Session Summary Question: Margins and Profitability - Management emphasized that OCI gross margins are improving due to automation and the integration of high-margin database services [25][26] - Autonomous databases are expected to significantly reduce costs, with potential savings of 35-50% as Fusion moves to autonomous systems [32] Question: AI Training vs Inferencing - Oracle sees ongoing demand for both AI training and inferencing, with specialized models driving growth in areas like healthcare [35][36] - The company is building gigawatt-scale data centers to support large AI models, with plans for multi-gigawatt facilities in the future [38] Question: Database Migration to Public Cloud - The company expects database migration to accelerate due to multi-cloud agreements with AWS, Azure, and Google Cloud [41][44] - Private clouds are also expected to grow, with Oracle offering identical functionality in both public and private cloud environments [44] Question: Monetization of GenAI in Applications - Oracle is already monetizing AI in healthcare applications, with AI-driven diagnostics, electronic health records, and prescription systems [47][50] - AI is integrated into all Oracle applications, making it a core component rather than a separate revenue stream [50] Question: Supply Availability and Data Center Infrastructure - Demand continues to outstrip supply, but the company is rapidly expanding capacity through automation and strategic location planning [53][54] - Oracle's fully automated data centers allow for efficient scaling, with plans to manage thousands of data centers globally [56] Question: Security and Large OCI Deals - Oracle is enhancing security through biometric authentication, Zero Trust Packet Routing, and autonomous systems to reduce human error [62][65] - The company's focus on security is a key differentiator in winning large OCI deals, particularly with government and enterprise customers [61][66]

Monday, September 9th, 2024Market indexes spent the full trading session in the green to start a new week on Wall Street. All were off intra-day highs, but only the small-cap Russell 2000 trailed off in the final half-hour of trading or so. The Dow grew +484 points, +1.20%, while the S&P 500 and the Nasdaq were both up +1.16%. The Russell came in +0.31%.Inventories, Credit Move Opposite DirectionsTwo relatively minor economic reports came out during today’s regular trading session: Wholesale Inventories for ...

For the quarter ended August 2024, Oracle (ORCL) reported revenue of $13.31 billion, up 6.9% over the same period last year. EPS came in at $1.39, compared to $1.19 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $13.22 billion, representing a surprise of +0.68%. The company delivered an EPS surprise of +5.30%, with the consensus EPS estimate being $1.32.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they c ...

Oracle (ORCL) came out with quarterly earnings of $1.39 per share, beating the Zacks Consensus Estimate of $1.32 per share. This compares to earnings of $1.19 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 5.30%. A quarter ago, it was expected that this software maker would post earnings of $1.64 per share when it actually produced earnings of $1.63, delivering a surprise of -0.61%.Over the last four quarters, the company has ...

Key TakeawaysOracle's fiscal first-quarter results exceeded analysts' expectations, sending shares higher in extended trading Monday.Revenue from Oracle's cloud services jumped as the company said demand for training AI large language models in the cloud surged.Oracle and Amazon Web Services also announced a multicloud partnership. Oracle (ORCL) shares jumped in extended trading Monday after the software giant reported fiscal first-quarter results that topped analysts’ expectations and announced a new partn ...

About this content About Angela Harmantas Angela Harmantas is an Editor at Proactive. She has over 15 years of experience covering the equity markets in North America, with a particular focus on junior resource stocks. Angela has reported from numerous countries around the world, including Canada, the US, Australia, Brazil, Ghana, and South Africa for leading trade publications. Previously, she worked in investor relations and led the foreign direct investment program in Canada for the Swedish government ...

Earnings and Profitability - Q1 GAAP Earnings per Share increased by 20% to $1.03, and Non-GAAP Earnings per Share increased by 17% to $1.39[1] - Net income grew by 21% to $2.929 billion, with diluted earnings per share increasing 20% to $1.03[15] - Net income for the three months ended August 31, 2024, was $2.929 billion, compared to $2.420 billion for the same period in 2023[23] - Q1 Non-GAAP operating income was $5.7 billion, up 13% in USD and 14% in constant currency[2] - Operating income rose by 21% to $1.7 billion, with operating margin improving to 30% from 26% in the prior year[15] Revenue Growth - Q1 Total Revenue reached $13.3 billion, up 7% in USD and 8% in constant currency[1] - Total revenues increased by 7% to $13.3 billion in Q1 fiscal 2025 compared to $12.453 billion in the same period last year[14] - Revenue for Q1 fiscal 2025 was $19.12 billion, showing an increase from $18.60 billion in Q4 fiscal 2024[26] - Total revenues for Q1 2025 reached $13.3 billion, showing a 7% growth compared to the previous year[29][30] - Constant currency revenue growth for total revenues was 8% in Q1 2025, slightly higher than the reported growth rate[29] Cloud Revenue and Performance - Q1 Cloud Revenue (IaaS plus SaaS) grew by 21% in USD and 22% in constant currency to $5.6 billion[1] - Q1 Cloud Infrastructure (IaaS) Revenue surged by 45% in USD and 46% in constant currency to $2.2 billion[1] - Q1 Cloud Application (SaaS) Revenue increased by 10% in both USD and constant currency to $3.5 billion[1] - Q1 Fusion Cloud ERP (SaaS) Revenue rose by 16% in USD and 17% in constant currency to $0.9 billion[1] - Q1 NetSuite Cloud ERP (SaaS) Revenue grew by 20% in both USD and constant currency to $0.9 billion[1] - Cloud services revenue grew by 21% in Q1 2025, contributing significantly to overall revenue growth[29] - Infrastructure cloud services and license support revenues increased by 13% in Q1 2025, reaching $5.75 billion[29] - Cloud services and license support revenue reached $141 million, up from $111 million in the prior year[16] Remaining Performance Obligations and Contracts - Q1 Total Remaining Performance Obligations increased by 53% to $99 billion[1] - Oracle signed 42 additional cloud GPU contracts in Q1, totaling $3 billion[3] Operating Expenses and Compensation - Total operating expenses increased by 2% to $9.316 billion, with research and development expenses rising to $569 million[15][16] - Stock-based compensation increased by 19% to $1.007 billion compared to $849 million in the prior year[15] - Stock-based compensation increased to $1.007 billion in 2024 from $849 million in 2023[23] Cash Flow and Capital Expenditures - Net cash provided by operating activities increased to $7.427 billion in 2024 from $6.974 billion in 2023[23] - Capital expenditures rose to $2.303 billion in 2024, up from $1.314 billion in 2023[23] - Free cash flow for Q1 fiscal 2025 was $9.455 billion, representing a 68% growth over the prior quarter[26] - Free cash flow as a percentage of net income was 189% in Q1 fiscal 2025, compared to 168% in the previous quarter[26] Assets and Liabilities - Total assets increased to $144.214 billion as of August 31, 2024, up from $140.976 billion at the end of the previous quarter[20] - Cash and cash equivalents grew to $10.616 billion, compared to $10.454 billion at the end of the previous quarter[20] - The company's cash and cash equivalents at the end of the period were $10.616 billion, down from $11.613 billion in the previous year[23] - Total intangible assets, net were $6.270 billion, with estimated future annual amortization expenses of $1.683 billion for the remainder of fiscal 2025[16] - Deferred revenues increased to $11.455 billion, up from $9.313 billion in the previous quarter[20] - Deferred revenues grew to $2.305 billion in 2024, slightly up from $2.317 billion in 2023[23] - The company issued $5.627 billion in term loan credit agreements in 2024, compared to none in 2023[23] Regional Revenue Performance - Americas region generated $8.37 billion in revenue for Q1 2025, maintaining its position as the largest revenue contributor[30] - Europe/Middle East/Africa region reported $3.23 billion in revenue for Q1 2025, showing steady growth[30] - Asia Pacific region contributed $1.71 billion in revenue for Q1 2025, reflecting a stable performance[30] Segment Performance - Cloud license and on-premise license revenue grew by 7% in Q1 2025, indicating a recovery in this segment[29] - Hardware revenue declined by 8% in Q1 2025, continuing a downward trend[29] - Services revenue decreased by 9% in Q1 2025, reflecting challenges in this segment[29]

Oracle chairman and chief technology officer Larry Ellison speaks at the Oracle OpenWorld conference in San Francisco on Sept. 16, 2019.Oracle shares rose 8% in extended trading on Monday after the database software vendor reported fiscal first-quarter results that topped Wall Street estimates.Here's how the company did in comparison with LSEG consensus:Earnings per share: $1.39 adjusted vs. $1.32 expectedRevenue: $13.31 billion vs. $13.23 billion expectedOracle's revenue increased 8% from $12.45 billion a ...

Q1 GAAP Earnings per Share up 20% to $1.03, Non-GAAP Earnings per Share up 17% to $1.39Q1 Total Revenue $13.3 billion, up 7% in USD and up 8% in constant currencyQ1 Total Remaining Performance Obligations up 53% to $99 billionQ1 Cloud Revenue (IaaS plus SaaS) $5.6 billion, up 21% in USD and up 22% in constant currencyQ1 Cloud Infrastructure (IaaS) Revenue $2.2 billion, up 45% in USD and up 46% in constant currencyQ1 Cloud Application (SaaS) Revenue $3.5 billion, up 10% in both USD and constant currencyQ1 Fu ...