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 feature New US CIO appointments, May 2024 Congratulations to these 'movers and shakers' recently hired or promoted into a new chief information officer, senior IT, or board role. By Martha Heller May 08, 2024 9 mins CIO Careers IT Leadership feature The extent Automic’s group CIO goes to reconcile data Cathy O'Sullivan, CIO editor-in-chief for APAC, recently sat with Marcelo Dantas, group CIO at Automic Group, to discuss completing one of the largest-ever registry services transitions in Australia, keeping pace with technology, and why cyberse By CIO staff May 08, 2024 9 mins CIO Cloud Native Data Quality feature Expion Health revamps its RFP process with AI The healthcare cost management firm built a customized AI tool to streamline an error-prone process for gaining new customers. Now, it’s considering selling the project for external use. By Grant Gross May 08, 2024 6 mins CIO 100 Healthcare Industry Digital Transformation feature Ways IT leaders can meet the EU AI Act head on The biggest mistake companies of all sizes could make is to put conformity before innovation, according to EU AI Act co-rapporteur Dragoș Tudorache. By Andrada Fiscutean May 08, 2024 6 mins CIO Military Regulation 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