- Oracle forecasts double-digit revenue growth for fiscal 2025, surpassing analyst expectations.
- The company announces partnerships with OpenAI and Google Cloud to expand its cloud infrastructure services.
- Oracle signed over 30 AI sales contracts worth more than $12.5 billion in the fourth quarter.
OUR TAKE
With the demand for AI growing, major AI companies, including Oracle and OpenAI, have reported revenue growth and forecast to continue this trend in the next fiscal year. This indicates the potential of the AI industry.
–Audrey Huang, BTW reporter
Oracle Corporation predicts its fiscal 2025 revenue will grow by double digits, indicating robust demand for its AI-powered cloud services. The company’s shares rose 9% after the announcement.
Oracle’s strong growth forecast
Oracle on Tuesday forecast revenue for fiscal 2025 to grow in double digits, above analysts’ estimates, indicating strong demand for its AI-powered cloud services, sending the company’s shares up 9% after the bell. “I expect that each successive quarter should grow faster than the previous quarter — as OCI (Oracle Cloud Infrastructure) capacity begins to catch up with demand,” CEO Safra Catz said.
AI-driven sales contracts
“In Q4 alone, Oracle signed over 30 AI sales contracts totalling more than $12.5 billion, including one with OpenAI to train ChatGPT in Oracle Cloud.” AI investments play a crucial role in Oracle’s efforts to catch up with cloud giants such as Microsoft, which is seeing rapid growth of its own Azure cloud due to its tie-up with OpenAI. Oracle has also spent billions of dollars on hardware from chip giant Nvidia.
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Financial performance
The company’s total revenue grew 3% to $14.29 billion in the fourth quarter, but missed LSEG estimates of $14.55 billion. Oracle reported total revenue growth of 6% for fiscal 2024. For FY25, analysts expect 9% growth. The company expects first-quarter revenue to grow between 5% and 7%, while analysts estimate a 7.6% rise. “In Q3 and Q4, Oracle signed the largest sales contracts in our history, driven by enormous demand for training AI large language models in Oracle Cloud,” Catz said.
