Oracle reports robust fiscal 2024 Q3 earnings with significant growth in cloud services
Oracle Corporation (NYSE: ORCL) has unveiled its fiscal 2024 third-quarter results, showcasing a significant 7% year-over-year increase in total revenues, reaching $13.3 billion. This growth is consistent in both USD and constant currency terms, highlighting Oracle’s robust performance amid a challenging global economic landscape. The company’s cloud services and license support segments led this impressive growth, with revenues climbing 12% in USD and 11% in constant currency to a remarkable $10.0 billion.
Despite the overall positive trend, Oracle reported a slight 3% decrease in cloud license and on-premise license revenues, which settled at $1.3 billion in both USD and constant currency. This dip contrasts with the company’s otherwise stellar financial metrics for the quarter.
Oracle’s operating income also saw notable increases, with GAAP operating income reaching $3.8 billion and non-GAAP operating income climbing 12% to $5.8 billion in both USD and constant currency. The GAAP operating margin stood at 28%, while the non-GAAP operating margin impressively hit 44%. Furthermore, Oracle’s GAAP net income was reported at $2.4 billion, with non-GAAP net income experiencing an 18% surge to $4.0 billion in both USD and constant currency.
Highlighting the success of the quarter, Oracle CEO Safra Catz emphasized the impact of large new cloud infrastructure contracts on the company’s performance. These contracts drove Oracle’s total Remaining Performance Obligations up by 29% to an unprecedented over $80 billion, marking an all-time record. Catz’s announcement underscores the high demand for Oracle’s Gen2 AI infrastructure, which significantly exceeds supply despite rapid expansion efforts in cloud datacenters. This demand is expected to keep Oracle’s Gen2 Cloud Infrastructure business in a hypergrowth phase, which saw a 53% increase in Q3.
Oracle Chairman and CTO Larry Ellison shared insights into the company’s strategic advancements in healthcare technology. Ellison highlighted the completion of moving the majority of Cerner customers to Oracle’s Gen2 Cloud Infrastructure and the forthcoming delivery of Oracle’s new Ambulatory Clinic Cloud Application Suite. This AI-driven suite is anticipated to revolutionize healthcare systems by improving data accuracy and efficiency through its Clinical Digital Assistant.
As a testament to its financial health and commitment to shareholder value, Oracle’s board of directors declared a quarterly cash dividend of $0.40 per share, payable in April 2024. This move reflects Oracle’s confidence in its financial stability and growth prospects.
In summary, Oracle Corporation’s fiscal 2024 Q3 report illustrates a company at the forefront of cloud and AI technology, driving significant revenue growth and paving the way for future innovations in healthcare and beyond. With a strong financial foundation and strategic investments in cloud infrastructure and applications, Oracle continues to solidify its position as a leader in the tech industry.