Oracle stock zooms 15% on partnership with world’s biggest cloud firm AWS

Texas company announces a 7% jump in last quarter's revenue, beating analysts' expectations

Oracle offices in Santa Monica, California. The company has 162 cloud data centres in operation and under construction around the world. AP

Oracle’s stock surged almost 15 per cent on Tuesday after the company announced a strategic partnership with the world’s biggest cloud computing company and its key competitor, Amazon Web Services, allowing customers to use several cloud platforms at once.

The partnership will allow Oracle customers to run database services on AWS infrastructure, simplifying data management and integration. It will also reduce data migration complexity, ensure low-latency connections and offer a unified support experience, the companies said.

Data-intensive industries such as finance, health care, manufacturing, telecoms and retail will have enhanced cloud agility and innovation while lowering their operational costs, they said.

After the announcement on Monday, Oracle’s stock surged 14.29 per cent to trade at $159.83 a share at 5.45pm UAE time on Tuesday, giving the company a market value of $441.68 billion. The company's market has jumped more than $55 billion in the past 24 hours.

The stock jumped 9.25 per cent to $152.81 a share in after-market trading on Monday. Oracle is about 34 per cent up since the start of the year, compared to the S&P 500′s 15 per cent surge.

“We are seeing huge demand from customers that want to use multiple clouds,” said Larry Ellison, Oracle’s chairman and chief technology officer.

With a 31 per cent market share, AWS is the biggest player in the global cloud infrastructure services sector. Photo: AWS

“With Oracle cloud infrastructure deployed inside AWS data centres, we can provide customers with the best possible database and network performance,” said Mr Ellison, who stepped down as Oracle chief executive in 2014.

Texas-based Oracle has 162 cloud data centres in operation and under construction around the world. Its annual event CloudWorld began in Las Vegas, Nevada, on Monday.

AWS is a cloud subsidiary of Amazon, the world's largest e-commerce company. It offers nearly 240 services – including computing, storage, databases, networking, analytics, machine learning and artificial intelligence – across 34 regions.

The partnership has come as cloud companies around the world are experiencing growing demand for their offerings from companies using AI.

We are seeing huge demand from customers that want to use multiple clouds

Larry Ellison,
Oracle’s chief technology officer

The global cloud computing market size was estimated at $602.31 billion last year and is predicted to surge at a compound annual growth rate of 21.2 per cent from 2024 to 2030, according to a report by Grand View Research.

In the cloud industry, businesses pay only for the selective services or resources they use over a period of time.

For businesses, moving to a cloud system hosted by a specialised company – such as Oracle, AWS or SAP – is more economical than creating their own infrastructure of servers, hardware and security networks. It also brings down the overall cost of ownership.

With a 31 per cent market share, AWS is the biggest player in the global cloud infrastructure services sector followed by Microsoft Azure with 25 per cent and Google Cloud with 10 per cent, data from Statista shows.

Global companies that heavily rely on third-party cloud providers stand to benefit from this new partnership. It will enable them to seamlessly leverage multiple cloud platforms without friction, optimising performance and scalability while reducing complexity.

The combination of AWS and Oracle “complements our own strength and breadth of capabilities and will allow us to develop and deliver secure, resilient, and innovative services faster and at scale”, said Scott Petty, chief technology officer at Vodafone, one of the biggest users of cloud.

“In addition to giving developers access to the latest cloud and data technologies, this partnership also avoids unnecessary fragmentation, removes duplication and reduces cost.”

Oracle beats quarterly earnings estimates

Oracle’s net income in the fiscal 2025 first quarter, which ended on August 31, grew more than 21 per cent to more than $2.9 billion. Its revenue during the June-August period jumped 7 per cent annually to $13.3 billion, exceeding analyst expectations of $13.2 billion.

The company’s earnings per share stood at $1.03 from $0.86 in the same quarter a year ago.

Oracle’s cloud services and licence support division contributed nearly 79 per cent of the total revenue in the last quarter. It surged more than 10 per cent to reach $10.5 billion.

The company’s services sector revenue dropped 9 per cent on a yearly basis to $1.2 billion, while hardware revenue dipped 8 per cent to $655 million. Its cloud and on-premises licence unit revenue expanded 7 per cent to $870 million.

Larry Ellison, chairman and chief technology officer of Oracle. Bloomberg

“As cloud services became Oracle's largest business, both our operating income and earnings per share growth accelerated,” said Oracle’s chief executive Safra Catz, who said she expects revenue growth throughout the financial year.

For the current quarter, the company expects a revenue growth in the range of 7 per cent to 9 per cent, Ms Catz said on the earnings call. Analysts were expecting growth of 8.8 per cent to $14.1 billion.

“Demand continued to outstrip supply,” she said.

In the last quarter, Oracle expanded its footprint globally, in August opening its second cloud region in Saudi Arabia – part of a $1.5 billion investment commitment announced by the US technology company in the Arab world's biggest economy.

The number of Oracle's cloud regions in the Middle East and Africa stands at eight, including two more planned for Morocco, according to a May statement.

On Monday, Oracle's board also announced a quarterly cash dividend of $0.40 a share that will be paid to stockholders as of close of business on October 10.