Oracle helps OpenAI to scale and looks forward to good business

The US software company Oracle has triggered optimism for future business with high bookings for its programs and partnerships. The SAP rival announced an expansion of its cooperation with the software group Microsoft and the ChatGPT inventor OpenAI on Tuesday evening after the close of the US stock exchange. In addition, search engine giant Google intends to offer Oracle database technology in its cloud platform. This gave the shares a strong boost.

In the collaboration with Microsoft and OpenAI, Oracle will provide data center capacity for AI. This will expand the Azure platform and "enable OpenAI to scale further", commented OpenAI CEO Sam Altman on the deal, according to the press release. Oracle is planning a "very, very large" data center, CEO Larry Ellison told investors, according to a report by The Register. Microsoft is to use half of the capacity. This would not be for inference, but primarily for mass training of models. Oracle and Microsoft had already intensified their cloud partnership last September.

Cloud infrastructure is booming

Oracle shares jumped by around 9 percent in pre-market US trading on Wednesday. This would put them well above their record high of 132.77 US dollars in mid-March.

In the fourth financial quarter, which ended in May, Oracle achieved a turnover of 14.3 billion US dollars (13.3 billion euros), an increase of three percent compared to the same quarter last year. This was less than previously expected by analysts. With business in the cloud infrastructure segment (IaaS), however, Oracle achieved a significant increase of 42 percent to two billion dollars, which was slightly above estimates.

The Cloud Services and License Support segment generated total sales of USD 10.23 billion, which corresponds to an increase of around 9 percent. Business with cloud and on-premises licenses fell by 15 percent and contributed USD 1.84 billion to revenue.

AI drives growth

Oracle CEO Safra Catz spoke of the highest sales contracts in the company's history over the past two quarters and held out the prospect of accelerated growth. In the new year, the boost in AI applications is expected to increase sales by a double-digit percentage. In the fourth quarter alone, the company signed contracts for over 12.5 billion dollars in AI technology, said Catz.

Overall, net profit in the quarter fell by five percent to 3.1 billion dollars. A year earlier, Oracle had been able to credit itself with taxes.

(dahe)