Oracle expects half a trillion dollars in booked cloud orders; its shares jump to record
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Oracle said recent and upcoming bookings will translate into a rapidly expanding cloud infrastructure business over the coming years.
PHOTO: REUTERS
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NEW YORK - Oracle shares surged to a record in extended trading on Sept 9 after the company posted a significant increase in bookings and gave an aggressive outlook for its cloud infrastructure business.
Known for its database software, Oracle has recently found success in the competitive cloud computing market. Earlier this summer, it inked an unprecedented commitment with OpenAI for 4.5 gigawatts worth of data centre capacity – enough energy to power millions of American homes. It also counts companies such as ByteDance’s TikTok and artificial intelligence chip giant Nvidia as major cloud customers.
Such deals helped boost remaining performance obligations to US$455 billion (S$584 billion) at the end of the fiscal first quarter, up from about US$138 billion at the end of the prior quarter, Oracle said on Sept 9.
“It was an astonishing quarter – and demand for Oracle Cloud Infrastructure continues to build,” chief executive officer Safra Catz said.
The company signed four multibillion-dollar contracts with three different customers in the quarter, and expects to sign up several additional customers in the coming months, she added, pushing remaining performance obligations – a measure of bookings – to over US$500 billion.
Oracle shares soared 28.4 per cent in extended trading to US$309.99.
Recent and some upcoming bookings will translate into a rapidly expanding cloud infrastructure business over the coming years, said Ms Catz. That unit will expand 77 per cent to US$18 billion this fiscal year, and continue to grow at an aggressive clip, reaching US$144 billion in annual revenue by the fiscal year ending in May 2030, she said. That outlook exceeded Wall Street estimates.
For the first quarter, cloud infrastructure revenue increased 55 per cent to US$3.3 billion, while analysts anticipated a 53 per cent expansion.
For the second quarter, Oracle expects total revenue to grow 12 per cent to 14 per cent, while it sees cloud revenue growth of between 32 per cent to 36 per cent. BLOOMBERG
