Oracle Reports Strong Q1 Fiscal 2025 Results
Oracle Corporation announced robust results for its fiscal 2025 first quarter, marking continued growth in key areas of the business. Total revenue for the quarter reached $13.3 billion, representing a 7% increase in USD and 8% in constant currency compared to the same period last year. Cloud services, one of Oracle’s fastest-growing segments, drove much of this growth, with revenues up 21% in USD and 22% in constant currency, reaching $5.6 billion. Cloud license and on-premise license revenue also saw an increase of 7% in USD and 8% in constant currency, totaling $870 million.
Financial Performance
Oracle’s Q1 GAAP operating income was $4.0 billion. Non-GAAP operating income, which excludes certain one-time costs, rose 13% in USD and 14% in constant currency, reaching $5.7 billion. The company’s GAAP operating margin stood at 30%, while its non-GAAP operating margin was higher at 43%, reflecting strong profitability. GAAP net income for the quarter was $2.9 billion, while non-GAAP net income increased 18% in USD and 19% in constant currency to $4.0 billion.
GAAP earnings per share (EPS) were $1.03, a significant 20% increase in USD and 22% in constant currency from the same period last year. Non-GAAP EPS grew to $1.39, up 17% in USD and 18% in constant currency, driven by operational efficiencies and revenue growth.
Cloud Growth and Strategic Partnerships
Oracle's cloud services have continued to expand rapidly. The company’s total remaining performance obligations (RPO), representing contracted future revenue, surged 53% year-over-year to $99 billion. This substantial contract backlog is expected to support revenue growth throughout fiscal 2025, highlighting the ongoing demand for Oracle’s cloud solutions. Short-term deferred revenues for the quarter were $11.5 billion, contributing to Oracle’s strong cash position.
Oracle CEO Safra Catz emphasized that the growth in cloud services has positioned the cloud as Oracle’s largest business segment, fueling accelerated growth in both operating income and earnings per share. Catz also pointed to Oracle's recently signed MultiCloud agreement with Amazon Web Services (AWS), which integrates Oracle’s Exadata hardware and the latest Version 23ai database software directly into AWS cloud datacenters. This agreement, set to go live in December 2024, will provide AWS customers with seamless access to Oracle's database technology, marking a significant step in Oracle's cloud strategy.
Expansion of Cloud Infrastructure
Oracle is continuing its aggressive expansion of cloud infrastructure around the world. According to Oracle Chairman and CTO Larry Ellison, the company now has 162 cloud datacenters in operation or under construction globally. The largest of these centers will be 800 megawatts in size and will feature extensive NVIDIA GPU clusters to support large-scale artificial intelligence (AI) model training. This infrastructure expansion is critical to Oracle’s ability to meet the growing demand for AI and machine learning services, which are increasingly central to modern business operations.
In the first quarter, Oracle signed 42 additional cloud GPU contracts, totaling $3 billion. These contracts will further enhance Oracle’s capabilities in providing high-performance cloud infrastructure for AI and other intensive computing tasks.
Ellison also highlighted Oracle’s continued success with its MultiCloud partnerships. The company’s agreement with Microsoft has already seen seven Oracle Cloud regions go live within Microsoft's Azure cloud, with 24 more in development. Similarly, four Oracle Cloud regions are now live with Google Cloud, and 14 more are being constructed. The recently announced AWS agreement represents another major milestone, allowing customers to utilize Oracle’s advanced database technology from within AWS's cloud platform, giving businesses more flexibility and choice in managing their data across multiple cloud environments.
Dividend Declaration
Oracle’s board of directors declared a quarterly cash dividend of $0.40 per share of outstanding common stock, underscoring the company’s commitment to returning value to shareholders. This dividend will be paid on October 24, 2024, to stockholders of record at the close of business on October 10, 2024.
Industry Leadership and Innovation
Throughout the quarter, Oracle continued to lead in both cloud services and technical innovation. A sample list of customers who purchased Oracle Cloud services during the quarter is available on the company’s website, showcasing Oracle’s expanding influence across industries. Additionally, Oracle made several important product announcements and technological advancements aimed at enhancing its cloud and database offerings.
Oracle’s strong cloud infrastructure, including its autonomous database and integrated suite of cloud applications, positions the company as a leader in the enterprise cloud market. Oracle’s ongoing investments in AI, machine learning, and MultiCloud capabilities enable it to provide comprehensive solutions to businesses worldwide.
To further support its leadership in the cloud space, Oracle actively engages with industry analysts. Reports on Oracle’s products and services from leading industry analysts can be accessed on the Oracle corporate website.
Earnings Conference Call and Webcast
Oracle will host a conference call and webcast today at 4:00 p.m. Central Time to discuss its Q1 fiscal 2025 results. A live and replay webcast will be available on the Oracle Investor Relations website. The company will provide additional insights into its financial performance, cloud strategy, and growth outlook during the call.
About Oracle
Oracle is a global leader in enterprise cloud computing, offering integrated suites of applications and secure, autonomous infrastructure in the Oracle Cloud. With its comprehensive portfolio of cloud solutions, including Infrastructure-as-a-Service (IaaS) and Software-as-a-Service (SaaS), Oracle helps businesses drive innovation, enhance productivity, and reduce operational costs. Oracle’s advanced database technology, combined with its AI and machine learning capabilities, enables businesses to extract valuable insights from their data and gain a competitive edge.
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