Oracle CEO Safra Catz said:Photo credit: Oracle
Having surpassed $3.6 billion in cloud revenue in the first quarter of fiscal 2023, Oracle expects large enterprise customers to migrate from AWS and Azure to OCI in the coming quarters.
After years of investment, Oracle’s bet on the cloud is starting to pay off. In fact, nearly a third of revenue was generated by cloud services in the publisher’s first quarter of its fiscal year 2023. Thus, total cloud revenue (SaaS and IaaS combined) reached $3.6 billion in his three months, up 50% year-over-year at other constant exchange rates. According to a statement made earlier this week by Oracle president Larry Ellison, all cloud services combined should bring him over $20 billion in annual revenue. Ellison also said Oracle has acquired about 1,000 new paying cloud customers in the past three months. Again, overall cloud growth, including Cerner, is expected to grow 46% 50% in constant currency and 42% 46% in dollars.Oracle CEO Safra Catz said on the results conference call:Excluding Cerner, total cloud growth for the fiscal year is estimated to be over 30% at constant currency, added a reader. The company’s total revenue for the quarter ended Aug. 31 was $11.4 billion, up 23% year-over-year. At the same time last year, Oracle reported his $9.7 billion total revenue.
Growth in all cloud segments
Oracle is experiencing rapid growth in all cloud sub-segments. Oracle’s cloud revenue includes both IaaS and SaaS. For IaaS, Oracle includes revenue from OCI (Oracle Cloud Infrastructure), Oracle Cloud at Customer, and Autonomous Databases. SaaS includes revenue from Oracle Fusion, Netsuite and other services. According to Oracle, his IaaS revenue was $900 million in the fourth quarter, up 58% from the same period last year, excluding contributions from Cerner. His OCI consumption for the quarter was up 104% year-over-year, followed by Oracle Cloud at Customer and Autonomous Databases consumption up 92% and 56% year-over-year, respectively.According to Katz this growth is related to the increased demand for OCI observed since April of this year, as well as new sales strategies.
Over the past two years, the vendor has consistently recruited talented engineers from the field to help customers migrate their workloads to OCI. The CEO of Oracle also pointed out, adding that these new hires will adapt to the transition in the most profitable way possible. In fact, Oracle seems confident enough to attract customers to his OCI from rival vendors such as AWS and Azure starting next quarter. More and more customers are using AWS and can save a lot of money by switching to OCI. You might be surprised to hear the names of certain companies leaving Amazon and moving into his OCI next quarter.said Mr. Cats again. Ellison said the same thing when asked about OCI’s go-to-market strategy on the same earnings call. Oracle expects his annual IaaS revenue, which includes OCI, Oracle Cloud at Customer and Autonomous Databases, to be $3.2 billion. Total vendor infrastructure subscription revenue, including support (cloud and on-premises), was $4.4 billion in the fourth quarter, up 7% on a constant currency basis, excluding Cerner’s contribution.
Fusion and NetSuite Still Growing
Convergent applications such as enterprise resource planning (ERP) and human capital management (HCM) software and NetSuite ERP continued to drive Oracle’s revenue. The provider expects annual sales for these services to reach his $5.8 billion. Annual revenue for mission-critical cloud back-office applications is now $5.8 billion, up 33% at constant currency, including Fusion ERP up 38%, NetSuite ERP up 30%, and Fusion HCM up 26% ., said Oracle’s CEO during a conference call. According to Katz, The growth of these services is due in particular to back-office cost reductions due to direct enterprise deployments. Cerner, which was acquired in December 2021 for $28.3 billion, posted $1.4 billion in revenue in the first quarter as part of Oracle, the vendor cites as the best quarter an IT services company has achieved since its inception. says. Oracle expects Cerner to generate more revenue in the coming quarters as it is fully integrated.
decrease in profit
While this record revenue for the first quarter of fiscal year 2023 far exceeded expectations, Oracle’s net income declined due to higher operating expenses, particularly in the areas of sales, marketing, and research and development. The supplier reported operating expenses of $8.8 billion, compared with his $6.3 billion in the same quarter last year. The company’s net income this year has reached $1.5 billion, up from his $2.4 billion in the same period last year.