Despite falling short of Wall Street expectations in terms of earnings per share and revenue, Oracle managed to increase its revenue by 3% year over year during the fourth quarter. The company reported earnings per share of $1.63 adjusted compared to the expected $1.65, and revenue of $14.29 billion against the expected $14.55 billion.
Oracle’s announcement of cloud deals with Google and OpenAI sparked a positive market response, with the company’s shares jumping as much as 9% in extended trading. Google Cloud will be hosting Oracle’s database software, set to be available in November, while OpenAI has selected Oracle’s cloud to bolster its computing capacity.
The cloud services and license support segment generated $10.23 billion in revenue during the quarter, a 9% increase year over year, slightly below the expected consensus. On the other hand, the cloud and on-premises licenses business saw a decline in revenue to $1.84 billion, down 15% from the previous year. Cloud infrastructure revenue grew by 42% to $2.0 billion, although this was a slight deceleration from the previous quarter.
Oracle’s cloud business, while smaller than competitors like Amazon Web Services and Microsoft Azure, is growing at a faster rate. The company’s move to expand its database offerings to Google Cloud and introduce generative artificial intelligence features in its Fusion cloud applications shows a commitment to innovation and staying competitive in the market.
Despite the mixed fourth-quarter results, Oracle’s stock has gained 18% so far this year, outperforming the S&P 500 index. The company’s executives are set to discuss the results further and provide guidance on a conference call, indicating transparency and a willingness to address any concerns from investors. Overall, Oracle’s ability to secure cloud deals with key partners like Google and OpenAI demonstrates its continued relevance and growth potential in the technology industry.