Oracle yesterday (June 11) announced a pair of cloud deals with Google (GOOGL) and Microsoft (MSFT)-backed OpenAI to broaden the availability of Oracle’s database software, sending the software giant‘s stock to jump more than 12 percent today (June 12). Oracle also reported its fiscal fourth-quarter financial results yesterday. Co-founder and Chairman Larry Ellison said on the earnings call that the company is building some of the world’s largest data centers, some of which are large enough to power an entire city.
Oracle is partnering up with Google to combine Oracle Cloud Infrastructure (OCI) and Google Cloud technologies, allowing Oracle’s database customers to deploy general purpose workloads in Google and Oracle cloud data center regions without data transfer fees. In a separate announcement, Oracle said it’s partnering with Microsoft and OpenAI to extend the Microsoft Azure Al platform to OCI to provide additional computing capacity for OpenAl. Microsoft struck a partnership with Oracle last September to allow its clients access to Oracle database from the Azure cloud. OpenAI also uses the Azure cloud to train its A.I. models.
Larry Ellison, who also serves as Oracle’s chief technology officer, hinted that the company exploring similar partnerships with Amazon (AMZN). “We would love to do the same thing with AWS (Amazon Web Services),” he said on the earnings call yesterday. (Oracle’s CEO is Safra Catz.) Ellison added that Oracle is building some of the world’s largest data centers. “Some are getting close to, dare I say it, a gigawatt, which is a pretty good-sized city or one enormous A.I. cloud training data center,” he said on the earnings call.
Ellison’s son, David Ellison, is also in the spotlight this week as Paramount Global abruptly broke off a closely watched merger talk with his entertainment company Skydance Media.
Oracle makes database software and cloud computing systems that are used by tens of thousands of businesses across industries. For example, Netflix uses Oracle’s technologies to analyze user data for personalized content recommendations; eBay uses Oracle’s database to manage online transactions, product listings and customer interactions. Oracle customers are eager to see the company incorporate A.I. features into its products to create a better user experience.
Oracle’s most recent fiscal quarter ended on May 31. Earnings during the quarter fell slightly short of Wall Street expectations. Revenue grew 3 percent year-over-year to $14.29 billion but missed the expected $14.55 billion. Net profit fell to $3.14 billion ($1.11 per share) from $3.32 billion ($1.19 per share) in the year prior. Adjusted earnings per share came at $1.63, missing the expected $1.65.