Oracle Corp Fourth Quarter and Fiscal Year 2024 Earnings Report

Date: June 13, 2024

Company: Oracle Corp (Ticker: ORCL)

Exchange: NYSE

Sector: Technology

Industry: Software - Infrastructure

Overview

Oracle Corp (NYSE: ORCL), a leading company in the Technology sector specializing in Software - Infrastructure, has released its financial results for the fourth quarter and fiscal year 2024. A detailed press release, including GAAP to non-GAAP reconciliations and other supplemental information, is available on Oracle's Investor Relations website.

Quarterly Highlights

Oracle experienced remarkable growth in the fourth quarter of 2024, driven by significant demand for cloud services. The cornerstone of this quarter's performance was a historic sales contract, spurred by the need for training large language models and record sales for Oracle Cloud Infrastructure (OCI), Autonomous Database, Fusion Applications, and NetSuite.

Remaining Performance Obligations (RPO) soared to $98B, representing a 44% increase year-over-year from $68B and an $18B rise from Q3. This shift reflects Oracle's successful strategy to secure multi-year cloud revenue commitments, which promises to accelerate future revenue growth rates.

Total cloud revenue, excluding Cerner, amounted to $4.7B, a 23% increase from the previous year. Including Cerner, cloud revenue climbed by 20% to $5.3B. SaaS revenue reached $3.3B, up 10%, while IaaS revenue surged by 42%, reaching $2.0B.

Strategic Developments

Oracle continues to expand its cloud services footprint, as evidenced by recent high-profile partnerships. Specifically, OpenAI selected OCI to run deep learning and AI workloads due to its superior performance and cost efficiency. Oracle inked over 30 AI contracts amounting to $12B this quarter, contributing to a cumulative $17B in AI-related revenues for the year.

In Q4, Oracle forged a multi-cloud partnership with Google, further highlighting the cross-cloud interoperability and robust infrastructure Oracle offers. This partnership allows customers to access Oracle Database Services directly from Google Cloud data centers starting in September.

Financial Performance

Oracle reported total revenues for the quarter at $14.3B, a 4% increase including Cerner, and 5% excluding Cerner. On a constant currency basis, cloud services and license support revenue hit $10.2B, growing by 10% driven by strategic cloud applications, Autonomous Database, and OCI. The strong revenues reflect robust operating performance, with non-GAAP EPS for Q4 achieved at $1.63.

For the full fiscal year 2024, Oracle's total company revenue totaled $53B, a 6% rise. Free cash flow saw a robust increase of 39%, totaling $11.8B. The operating cash flow grew by 9% to $18.7B. RPO for the year reached a staggering $98B, up 44%, underscoring the substantial growth in long-term cloud service commitments.

Future Outlook

Looking ahead to fiscal year 2025, Oracle anticipates continued strong demand and double-digit revenue growth, driven by increased capacity and a growing pipeline. The fiscal year 2025 CapEx is expected to double compared to 2024 to meet the increasing demand.

Risk Factors and Forward-Looking Statements

Oracle’s forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially. These statements are based on diverse assumptions available at the time of reporting, and Oracle does not undertake any duty to update these statements to reflect subsequent developments.

Contacts and Further Information

Further detailed financial information and supplementary materials can be accessed via Oracle's Investor Relations website. The official filing can be viewed using this link.