On Monday, Oracle announced its fiscal 2025 Q2 results, reporting a 9% year-over-year increase in total revenue, reaching $14.1 billion. Cloud revenue totalled $5.9 billion, up 24% in both USD and constant currency.
Interestingly, Larry Elison, CTO at Oracle, revealed during the earnings call that Oracle had signed an agreement with Meta to use the company’s AI Cloud infrastructure and collaborate on the development of AI Agents based on Meta’s Llama models.
“Record-level AI demand drove Oracle Cloud Infrastructure revenue up 52% in Q2, a much higher growth rate than any of our hyperscale cloud infrastructure competitors,” said Oracle CEO Safra Catz. She added that Oracle expects Cloud revenue to top $25 billion this fiscal year.
“We delivered the world’s largest and fastest AI SuperComputer scaling up to 65,000 NVIDIA H200 GPUs,” said Catz commenting on how GPU consumption rose by 336% during the quarter, reflecting rapid growth in AI-related workloads.
However, when compared to industry leaders, Oracle’s cloud revenue scale still lags. In the previous quarter, Amazon Web Services (AWS) earned $27.5 billion in revenue, a 19% increase from the same quarter a year ago. Microsoft’s Intelligent Cloud revenue reached $24.1 billion, up 20%. Meanwhile, Google Cloud’s revenue surged 35%, reaching $11.4 billion.
The company shares fell 9% on Tuesday, signalling investor concerns over fierce competition in the cloud business amid higher demand from AI service providers, Reuters reported.
“Oracle Cloud Infrastructure trains several of the world’s most important generative AI models because we are faster and less expensive than other clouds,” said Ellison.
Ellison further emphasised the scope of Oracle’s AI capabilities, saying, “Oracle trains dozens of specialised AI models and embeds hundreds of AI Agents in cloud applications,” including automating drug design, detecting fraud, and analyzing satellite images to improve agricultural output.
Oracle has officially entered the multi-cloud era. Following its partnership with Microsoft Azure and Google Cloud, earlier this year, the company also teamed up with AWS to launch Oracle Database@AWS. This service will allow customers to use Oracle Autonomous Database and Exadata Database Service within AWS’ data centres.
“We’re at the very beginning of multi-cloud. It’s going to exceed well over $100 million in its first year,” said Ellison. He further explained that the first year began when Oracle got AWS and had all three, including Microsoft Azure and Google Cloud.
“It will be a multibillion-dollar business, and it’ll be a combination of AWS, Google, and Azure, plus all of these Cloud@Customer, Dedicated Region Cloud@Customer. We’re going to have hundreds of those regions,” he added.
Ellison said that the demand from individual customers, large banks, and telecoms is so great that they are building nearly half a dozen data centres.
With inputs from Siddharth Jindal, Tech Journalist, AIM
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