Join Larry Ellison live from #CloudWorld as he discusses our differentiated #AI innovation across databases, infrastructure, and applications. https://t.co/FzjQfGtlhP
— Oracle (@Oracle) September 10, 2024
Oracle shares jumped nearly 10% in Tuesday’s trading session after the company reported fiscal first quarter results that exceeded expectations on both the top and bottom lines. The cloud provider also announced a new partnership with Amazon Web Services. For the quarter, Oracle’s sales rose 7% year-over-year to $13.3 billion, surpassing estimates of $13.21 billion.
Join Larry Ellison and @awscloud’s CEO Matt Garman tomorrow at #CloudWorld to learn about our landmark multicloud partnership and the new Oracle Database@AWS: https://t.co/k9Wbk0CgZJ pic.twitter.com/Di4EhJeWPk
— Oracle (@Oracle) September 10, 2024
Earnings per share of $1.39 beat expectations by 5% and marked a 17% increase from the $1.19 reported in the same quarter last year. Cloud infrastructure revenue growth was a key driver of the strong results. Oracle CEO Safra Catz commented on the quarter: “Our cloud infrastructure business is booming as we are helping our customers save money, save time, and eliminate risks as they move more and more of their operations to the cloud.
Our cloud applications businesses are also growing rapidly.”
There is so much going on at @CloudWorld right now!
See who you can hear from tomorrow and take a look at the:
Oracle ACE sessions ? https://t.co/z1QCQolweE
Oracle ACE speakers ? https://t.co/kE8No6Dkqk#OracleACE pic.twitter.com/A5S9JUM5sG— Oracle ACE Program (@oracleace) September 10, 2024
Looking ahead, Oracle expects 8-10% sales growth for the second quarter, in line with the Zacks Consensus estimate of $14.01 billion, representing 8% growth.
oracle shares jump on earnings boost
Zacks estimates project Oracle’s total sales to increase 9% in fiscal year 2025 to $57.82 billion, up from $52.96 billion in fiscal 2024.
Fiscal 2026 sales are expected to rise another 11% to $64.02 billion. Oracle’s earnings are also forecasted to grow, with annual earnings expected to increase 11% in fiscal 2025 and jump another 13% in fiscal 2026 to $6.98 per share. At around $155 per share, Oracle trades at a forward price-to-earnings ratio of 22.6, slightly below the S&P 500’s 23 and at a discount to the Zacks Computer Software Industry average of 33.6. The company also trades at a lower valuation compared to tech partners like Nvidia and Amazon.
The partnership with Amazon will allow customers to access Oracle databases within Amazon Web Services. Don Johnson, executive vice president of Oracle Cloud Infrastructure, stated: “This is a great opportunity for our joint customers to take advantage of the compatibility, reliability, and performance of Oracle databases while benefiting from the elasticity, economics, and innovation of AWS.”
Following the strong quarterly report, Oracle currently holds a Zacks Rank #2 (Buy). The company’s expanding cloud presence through partnerships appears to position it well for continued growth.
