The company said it expects cloud revenue to grow 29% to 31% in the second quarter of 2024, even as the overall business grows in single digits. Credit: Reuters Oracle is betting on high demand for data, driven by generative AI-related workloads, to boost revenue in upcoming quarters as enterprises look to adopt generative AI for productivity and efficiency. “Generative AI is changing everything. As of today, AI development companies have signed contracts to purchase more than $4 billion of AI training capacity in Oracle’s Generation 2 cloud. That’s twice as much AI training as we had booked at the end of the last Q4,” Larry Ellison, executive chairman, and chief technology officer at Oracle, said during an earnings call with analysts. This demand in generative AI workloads, according to Ellison, will sustain itself as enterprises will have to continue feeding data to the AI engine or models to keep them up-to-date or relevant, which in turn will create demand for Oracle’s offerings for model training, inferencing, and grounding. The proliferation of generative AI is also expected to drive up demand for Oracle’s databases as well, Ellison said, adding that Oracle’s new vector databases will allow enterprises to store specialized data for training models while maintaining the anonymity and privacy of the datasets. Earlier in July, a top Oracle executive had laid down Oracle’s three-tier approach to attract more revenue from generative AI offerings to take on rival cloud service providers — AWS, IBM, Google Cloud, and Microsoft. Second quarter cloud revenue to grow up to 31% Oracle, which posted its first-quarter earnings for the fiscal year 2024 on Monday, expects its cloud revenue for the second quarter, with the exclusion of revenue from Cerner, to grow by up to 31%, buoyed by the phenomenon of enterprises adopting more AI services. However, total revenues including Cerner are expected to grow much slower at 3% to 5% in constant currency and 5% to 7% in USD at today’s rates. For the first quarter of fiscal year 2024, Oracle posted a total revenue of $12.5 billion, up 9% from last year. Net income for the quarter rose 56% year-on-year to $2.4 billion. The growth in total revenue was driven by the momentum in the company’s total cloud sales (IaaS and SaaS combined), which grew 30% year-on-year to $4.6 billion. Revenue from IaaS was up 66% to $1.5 billion. Revenue from cloud applications for the quarter grew 15% year-on-year to $3.1 billion. In its last sequential quarter, the company posted a total revenue of $13.8 billion, boosted by cloud sales that brought in $4.4 billion. In the quarter-ended August, Oracle said it signed several deals for its Cerner unit and other ERP businesses. “And I’m now able to announce that all nine utility companies owned by Berkshire Hathaway are in the process of replacing all their existing ERP systems, and standardizing on Oracle’s Fusion Cloud applications,” Ellison said, according to a Seeking Alpha transcript. “In the current quarter we expect our Cerner Health business to be awarded two large new contracts with a total value of over $1 billion,” Ellison added. Oracle also plans to expand its existing multicloud partnership with Microsoft by making it easier for Microsoft Azure customers to buy and use Oracle cloud database technology in combination with Microsoft Azure cloud services, Ellison said. Related content news IBM and AWS forge global alliance, streamlining access to AI and hybrid cloud solutions This partnership will allow businesses in 92 countries access to IBM’s software products, including data technologies and AI, directly through the AWS Marketplace. By Gyana Swain May 03, 2024 5 mins Amazon Web Services Hybrid Cloud Artificial Intelligence feature UPS delivers customer wins with generative AI The multinational shipping company enlisted LLMs to automate customer message responses, reducing agent handle time and paving the way for genAI use across the enterprise. By Paula Rooney May 03, 2024 7 mins CIO 100 Generative AI Digital Transformation feature Scrum master certification: Top 13 certs for agile pros A Scrum master certification can prove you have the knowledge and competency to lead agile teams successfully. By Sarah K. White, Sharon Florentine May 03, 2024 16 mins Certifications Agile Development IT Skills brandpost Sponsored by Canon NZ Why your business needs a cloud-based print management solution If your business isn’t using a cloud-based print management solution, you’re missing out on a range of efficiency, environmental and security benefits. By Canon New Zealand May 02, 2024 5 mins Managed Cloud Services PODCASTS VIDEOS RESOURCES EVENTS SUBSCRIBE TO OUR NEWSLETTER From our editors straight to your inbox Get started by entering your email address below. Please enter a valid email address Subscribe