Welcome to the Cloud Wars Minute — your daily cloud news and commentary show. Each episode provides insights and perspectives around the “reimagination machine” that is the cloud.
In today’s Cloud Wars Minute, I discuss Oracle’s amazing Q1 results.
Highlights
00:17 — Oracle yesterday released its fiscal Q1 results for the quarter ended August 31. And while its revenue figures for those three months were nice, the killer here was its RPO: remaining performance obligation. Oracle reported remaining performance obligation up 359% to $455 billion.
01:24 — Microsoft’s cloud revenue is almost seven times bigger than Oracle’s. Who’s winning the most business out into the future? Several weeks ago, Microsoft reported its RPO was up 37% to an astonishing $368 billion, the biggest RPO number I had ever seen. Several weeks later, we see Oracle blow that away. It’s got an RPO nest egg out there that is 25% bigger than Microsoft’s.
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02:35 — Now, Oracle CEO Safra Catz, in perhaps the understatement of the year, said, “Oracle is off to a brilliant start in FY26.” My point there is, I’ve just never seen anything like this. Astonishing. And we can point to the OpenAI deal that’s due to start in a few years, where OpenAI has contracted with Oracle to pay Oracle $30 billion a year for Oracle Cloud Infrastructure.
03:09 — Catz referenced a number of gigantic contracts that Oracle has signed, and they’ll be talking about more soon. Catz did take the unusual step of projecting future revenue for Oracle Cloud Infrastructure — OCI — and its growth over the next five years, including the current year we’re in. And I want to emphasize: These numbers don’t include Oracle’s cloud applications business.
03:50 — So, for this year — FY26, ending May 31, 2026 — OCI revenue will grow 77% to $18 billion. Then next year, up 44% to $32 billion. Then it’s going to take a spectacular leap — up 128% to $73 billion. I believe that’s when the OpenAI revenue starts to kick in. Then 56% to $114 billion for fiscal ’29. Fiscal ’30, up 26% to $144 billion. Again, I’ve never seen any numbers like this.
05:06 — It’s a very different approach Oracle has taken. These numbers show just an astonishing future for Oracle, and I think it’s fair to say too that these results from Oracle — and the indication of its future success — have definitely, completely rattled — turned upside down — the balance of power in the Cloud Wars. Oracle is the hottest hyperscaler in the world now, by far and often.
