Oracle’s shares soared by 9% in after-hours trading after the company announced cloud deals with Google and OpenAI. This announcement came despite fourth-quarter results that fell short of Wall Street expectations. The company reported earnings per share of $1.63, slightly lower than the expected $1.65, and revenue of $14.29 billion, missing the $14.55 billion expected figure. However, Oracle’s revenue increased by 3% year over year during the quarter ending on May 31.
The cloud services and license support segment of Oracle generated $10.23 billion in revenue, a 9% increase from the previous year, though slightly below the StreetAccount consensus. On the other hand, the cloud and on-premises licenses business saw a decrease in revenue to $1.84 billion, down 15% from the previous year. Despite this, cloud infrastructure revenue rose to $2.0 billion, up by 42% from the previous quarter. Oracle’s cloud business, while smaller than competitors like Amazon Web Services and Microsoft Azure, is growing rapidly.
Oracle also announced that it would bring its database to Google’s cloud in November, allowing organizations to deploy workloads in Google and Oracle cloud data center regions without data-transfer charges. OpenAI has also selected Oracle’s cloud to provide additional computing capacity, moving away from Azure. Additionally, Oracle will be expanding its database software to five more Azure data center regions, bringing the total to 15. Generative artificial intelligence features are also set to be introduced to Oracle’s Fusion cloud applications for supply chain and human resources.
Despite the fourth-quarter results falling short of expectations, Oracle’s stock has gained 18% this year, outperforming the broader market. The company’s executives will further discuss the results and provide guidance on a conference call starting at 5 p.m. ET. It remains to be seen how these new cloud deals and initiatives will impact Oracle’s growth and competitiveness in the cloud services industry. Stay tuned for more updates on Oracle’s latest developments.
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