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In today’s Cloud Wars Minute, I provide insight into Oracle’s latest success, with strong Remaining Performance Obligation (RPO) figures, strong cloud infrastructure growth, and a noteworthy partnership with AWS.
Highlights
00:17 — Oracle’s remaining performance obligation (RPO) for the quarter was up 52% to $99 billion. A couple of other quick numbers: total cloud revenue was up 22% to $5.6 billion, and within that, Oracle Cloud Infrastructure consumption revenue was up 56%. Overall, cloud infrastructure revenue was up 46%, and software as a service (SaaS) revenue was up 10% to $3.5 billion.
00:52 — The RPO figure represents business that has been contracted but is not yet recognized as revenue. In that last quarter, Oracle said its RPO was up 44% to $98 billion, a record. So, three months later, for the quarter ended August 31, we saw the RPO growth rate jump up to 52%, and the total RPO volume reached $99 billion.
02:09 — Safra Catz, the CEO, said that in Q1, it spent $2.3 billion on CapEx, almost all of that for infrastructure. So, that approximates a $10 billion annual budget for CapEx almost all of it for cloud infrastructure, indicative of how rapidly Oracle’s cloud business is growing. Catz also said that for fiscal 2025, she expects CapEx to double compared to FY 2024.
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03:22 — Larry Ellison mentioned that Oracle is currently constructing one data center that is an 800-megawatt facility, and it is about to begin construction on a gigawatt data center. This is indicative of the incredible customer demand and how the AI revolution is triggering entirely an new scale of services for the cloud. “The stakes are high, and the race goes on,” Ellison said.
04:35 — What Ellison is implying is that the race can change. The race that was run in the past is not necessarily the one that will be run in the future. I also want to point out that Ellison will be joined on stage by AWS CEO Matt Garman during his keynote. As I’ve alluded to a few times over the past year, AWS and Oracle have now signed a multi-cloud agreement. This is a huge win for customers.
05:15 — So, big fiscal Q1 numbers for Oracle, big expectations for continued growth across the board, and a lot of momentum in their cloud database services area. It looks like a very bright future, especially now that they’ve signed the AWS multi-cloud deal as well.
