Oracle beats revenue estimates as cloud business booms
Oracle has reported quarterly revenue that beat analysts’ expectations, pushed by greater demand for its cloud computing services, as the COVID-19 pandemic has led to a rapid shift to remote working.
In a statement, the enterprise software giant said its fiscal first-quarter sales rose 1.6% to $9.37 billion, beating the average estimate of $9.19 billion, sending shares up 5% yesterday.
The company’s net income rose to $2.25 billion, or 72c per share, in the first quarter ended 31 August, from $2.14 billion, or 63c per share, a year ago.
Oracle says it has seen a massive uptake of its Oracle ERP Cloud solutions, aimed at helping businesses run their entire company remotely and address common remote working challenges.
The company has a partnership with Zoom Video Communications to support its exponential growth, as the video-conferencing platform’s daily users spiked to 300 million in recent months.
The impact of COVID-19 has resulted in an urgent need for remote interactions, as people across the globe have been forced to substitute their in-person meetings and physical events with virtual meetings and online conferences.
"Our cloud applications businesses continued their rapid revenue growth, with Fusion ERP up 33% and NetSuite ERP up 23%,” says Oracle CEO Safra Catz.
“We now have 7 300 Fusion ERP customers and 23 000 NetSuite ERP customers in the Oracle Cloud. Our infrastructure businesses are also growing rapidly, as revenue from Zoom more than doubled from Q4 last year to Q1 in this year. I have a high level of confidence that our revenue will accelerate as we move on past COVID-19."
South African surveyed respondents of the “Cloud in Africa 2020” report stated the COVID-19 pandemic has pushed cloud computing to front of mind, with 91% regarding it as an important resource for coping with challenges of the crisis.
Since the outbreak, cloud computing has been used primarily for disaster recovery (91%) and remote working (82%), followed by customer service activities (52%), the survey shows.
Oracle returns to sales growth at a time when the company has been in a push to rapidly expand its cloud infrastructure, announcing plans to build 20 new data centre regions by the end of this year, for a total of 36 Oracle Cloud Infrastructure regions.
These are set to be established in SA, US, Canada, Brazil, UK, European Union (Amsterdam), Japan, Australia, India, South Korea, Singapore, Israel, Chile, Saudi Arabia and United Arab Emirates.
In February, the company announced the addition of five new data centres in Jeddah, Saudi Arabia; Melbourne, Australia; Osaka, Japan; Montreal, and Amsterdam.
Oracle confirmed to ITWeb that it is preparing to launch its South African data centre region, which is planned to open before the end of 2020.