Cloud computing seems to be profitable for Oracle. This week, the company announced results exceeding Wall Street experts’ estimates. Demand for its cloud products has indeed experienced strong growth in an environment where the transition to cloud computing platforms continues to accelerate.
The company reported Monday revenues of US$11.85 billion against a forecast of US$11.66 billion. This corresponds to adjusted earnings per share of US$1.54, versus a forecast of US$1.37.
The company’s revenue grew 5 per cent year on year, driven primarily by growth in the company’s cloud infrastructure business, which competes with the likes of Amazon Web Services and Microsoft Azure.
“We believe this spike in revenue growth indicates that our infrastructure business has now entered a phase of hyper-growth,” said Safra Catz, CEO of Oracle, in a statement.
The company expects revenue growth of between 17 and 18 per cent in the first quarter, boosted by its US$28.3 billion acquisition of healthcare IT company Cerner Corp, a developer of software used by doctors and hospitals to manage and store medical records, completed earlier this month.
Oracle said its cloud computing sales increased 36 per cent, boosting revenue by 19 per cent to US$2.9 billion. According to Synergy Research Group, Oracle failed to rank among the top five global cloud infrastructure providers at the end of last year. But the company boasts that it can not only attract its old customers to its cloud products, but also attract new customers.
Microsoft and Salesforce have also pointed to a strong future for the cloud computing market as companies ramp up spending, despite the former slashing its fourth-quarter earnings and revenue guidance earlier this month due to unfavourable exchange rates.