Oracle earnings beat expectations with growth in cloud

Oracle on Wednesday revealed better-than-expected earnings thanks mainly to its progress in the cloud, including its recent acquisition of NetSuite.

For its fiscal third quarter, Oracle said, its adjusted earnings were 69 cents a share, on $9.21 billion in sales, as against earnings of 64 cents a share on revenue of $9.01 billion in the same period a year ago.

Oracle's total revenue from all its cloud business stood at $1.2 billion, up 62 per cent and formed a small but growing portion of its overall $9.3 billion revenue in the fiscal third quarter.

Chairman and co-founder Larry Ellison told investors on Wednesday that of all the company's efforts in cloud computing, its infrastructure business that directly competed with Amazon Web Services would be Oracle's biggest cloud effort.

''Together, SaaS (software as a service) and PaaS (platform as a service) grew 85 per cent this past quarter,'' Ellison told analysts on a conference call. ''But soon infrastructure-as-a-service will be growing even faster, and before long, infrastructure-as-a-service will become Oracle's largest cloud business.''

At Ellison took aim Amazon last September, at Oracle's OpenWorld, its big user conference. He highlighted better performance running Oracle's database software in its cloud service as against Amazon Web Services, also known as AWS. Commentators point out this would be an ambitious goal, with Amazon the dominating player in the cloud infrastructure business and Microsoft Corp's growing presence with its Azure business.

Oracle said software-as-a-service and platform-as-a-service cloud sales rose 73 per cent from the year-ago period, to $1 billion.

Discussing Oracle's results, on a conference call, Ellison said: ''We have a very large database business.'' There are millions of applications that run on the Oracle database. Most will move to the cloud, and we think we have a huge technology lead over Amazon (Web Services) and (Microsoft) Azure.''