Oracle beat investment analysts' estimates with a Q1 revenue haul of $13.3 billion, up 7 percent year-on-year, a feat one market watcher chalked up to "several large deals being signed" in the period.
The news for the three months ended August 31 - the first quarter of Oracle's fiscal 2025 - gave the database and application giant a share price boost of 9 percent in after-hours trading, no doubt aided by its confirmation of a new agreement with AWS to port its database service to the dominant cloud platform provider.
Oracle's net income jumped 22 percent over the year to hit $2.9 billion. CEO Safra Catz said it was "clearly another outstanding quarter" with total cloud revenue for SaaS and IaaS increasing 22 percent at $5.6 billion. She added that software license revenues were up 8 percent to $870 million, including Java, "which saw excellent growth."
Oracle last year changed its licensing terms for Java, a move which Gartner said might increase customers' costs by two to five times.
The long-serving CEO also toasted an increase in margins in multi-cloud agreements for Oracle's Cloud Infrastructure (OCI) platform.
It's fully automated, no human labor, much more secure. The margins for the autonomous database business are much higher ... stunningly high
"Our multi-cloud agreements will help OCI gross margins... our business is really only now starting to get real scale. We have built OCI in a way [that is] extremely automated. As it grows, we make more money. As much as percentages are great, our operating margin percentages continue to increase," she said.
Larry Ellison, co-founder, chairman and CTO, also talked up the high margins that Oracle makes - the company is, after all, an organization which is notoriously tough on customers during licensing negotiations.
Ellison, who celebrated his 80th birthday during the quarter, explained that the company's so-called Autonomous Database helped improve the bottom line.
"It's fully automated, no human labor, much more secure. The margins for the autonomous database business is much higher or much higher than the traditional Oracle business. Those margins are stunningly high."
He said Oracle achieved similar margins on its SaaS products, as the systems are based on Oracle Autonomous Database.
"We use hardware very efficiently. We use labor sparingly because labor is a security risk. When people are actually doing things manually, it's a security risk, and it slows down our ability to expand," he said.
- City council faces £216.5M loss over Oracle system debacle
- SQL king Larry Ellison becomes sequel sultan with controlling interest in Paramount Global
- Enterprise spend on cloud up sharply as world biz splashes $80B in Q2
- SQL king Larry Ellison becomes sequel sultan with controlling interest in Paramount Global
Megabuyte analyst Nathan Jackson said Oracle usually experiences declines in its remaining performance obligations in its Q1 due to contracted revenue being released at the start of the year.
"Q1 '25 has bucked that trend due to several large deals being signed in-period. This is reflective of Oracle customers opting for longer and larger contracts, however, we feel that this is the result of Oracle's multi-cloud strategy where it is hosted within Azure, Google Cloud and now, AWS. This makes OCI and Oracle available within all of the hyperscalers, a unique advantage as enterprises consider the resiliency and complexity of their cloud estates."
Oracle Database@AWS will allow customers to buy Oracle Database services using their existing AWS commitments and use their existing Oracle license benefits, including Bring Your Own License and discount programs such as Oracle Support Rewards. ®