Oracle Reports Strong Q1 Results and Announces Partnership with Amazon

Key Takeaways

• Oracle’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 partnership with Amazon (AMZN).

Oracle reported first-quarter revenue grew 7% year-over-year to $13.3 billion and earnings per share rose to $1.03 from 86 cents a year ago, both of which surpassed analyst estimates compiled by Visible Alpha.

Cloud Services, Oracle’s largest business, delivered revenue growth of 21% to $5.6 billion as the company said demand for training AI large language models in the cloud surged. Oracle CEO Safra Catz also said its “strong contract backlog will increase revenue growth throughout FY25.”

Oracle Announces AWS Partnership

Oracle Cloud Infrastructure (OCI) revenue surged 45% year-over-year to $2.2 billion, and the company launched a new multicloud partnership with Amazon Web Services (AWS) that it expects to drive additional growth.

The partnership is designed to allow customers to access Oracle database technology using AWS cloud data centers. The companies said they would provide more details about the agreement at the Oracle CloudWorld conference on Tuesday.

Shares of Oracle were up over 9% at $152.90 in extended trading Monday following the release.

Oracle’s strong fiscal first-quarter results have exceeded analysts’ expectations, leading to a surge in the company’s shares in extended trading on Monday. The software giant reported a 7% year-over-year growth in revenue to $13.3 billion, surpassing analyst estimates. Additionally, earnings per share rose to $1.03 from 86 cents a year ago, further exceeding expectations.

The significant growth in Oracle’s revenue can be attributed to its Cloud Services business, which saw a 21% increase in revenue to $5.6 billion. The company highlighted the surge in demand for training AI large language models in the cloud as the driving force behind this growth. Oracle CEO Safra Catz also expressed confidence in the company’s future revenue growth, stating that its “strong contract backlog will increase revenue growth throughout FY25.”

Furthermore, Oracle announced a new partnership with Amazon Web Services (AWS) that is expected to drive additional growth. The partnership aims to enable customers to access Oracle database technology using AWS cloud data centers. More details about this agreement will be revealed at the Oracle CloudWorld conference on Tuesday.

The market responded positively to Oracle’s strong performance and the announcement of the AWS partnership. In extended trading on Monday, Oracle’s shares surged over 9% to reach $152.90.

This partnership with AWS is a strategic move by Oracle to expand its reach and tap into a larger customer base. By leveraging AWS cloud data centers, Oracle can provide its database technology to a wider audience, enhancing its market presence and driving growth.

The collaboration between Oracle and AWS reflects the increasing trend of multicloud strategies adopted by businesses. Many organizations are opting for a combination of different cloud platforms to meet their specific needs and leverage the unique offerings of each provider. This partnership allows customers to benefit from the strengths of both Oracle and AWS, creating a more comprehensive and flexible solution.

The announcement of the partnership at the Oracle CloudWorld conference on Tuesday indicates that both companies are committed to working closely together to ensure the success of this collaboration. This event will provide more insights into the specifics of the agreement and the potential benefits it offers to customers.

Overall, Oracle’s strong fiscal first-quarter results and the announcement of the partnership with AWS have positioned the company for continued growth and success. The surge in revenue, particularly in the Cloud Services business, demonstrates Oracle’s ability to adapt to evolving market demands and capitalize on emerging technologies such as AI. The partnership with AWS further strengthens Oracle’s position in the cloud market and expands its customer reach. As the company continues to innovate and forge strategic alliances, it is well-positioned to maintain its growth trajectory and deliver value to its shareholders.

Disclaimer: The information provided in this article is for informational purposes only and should not be considered as investment advice. The author does not hold any positions in the mentioned securities.