Oracle Issues Upbeat Cloud Revenue Forecast Amidst Major Contract Wins
Oracle Corporation has delivered a strong update to its financial outlook, sending its shares soaring to their highest single-day gain in over two decades. The surge follows the announcement of several massive new cloud contracts and an ambitious revenue projection for its Oracle Cloud Infrastructure (OCI) business, positioning Oracle as a growing contender in the competitive cloud industry[2].
Multibillion-Dollar Cloud Deals Drive Financial Optimism
Oracle signed four multibillion-dollar agreements with three distinct customers in its recent quarter, propelling its remaining performance obligations (RPO) to $455 billion—a 359% increase year-over-year. RPO represents contracted revenue that has not yet been booked but is highly likely to be recognized in the future[2]. CEO Safra Catz emphasized the momentum, stating, "Over the next few months, we expect to sign-up several additional multi-billion-dollar customers and RPO is likely to exceed half-a-trillion dollars"[2].
Revised Cloud Revenue Targets for the Next Five Years
Thanks to strong demand and significant growth in contracted agreements, Oracle dramatically raised its OCI revenue forecast:
- $18 billion expected in the current fiscal year
- $32 billion projected for fiscal 2027
- $73 billion in fiscal 2028
- $114 billion in fiscal 2029
- $144 billion by fiscal 2030
Most of this revenue is already reflected in the company’s reported RPO, underlining the firm’s robust pipeline[1][2].
Oracle’s Position in the Cloud Market
Despite the rapid growth, Oracle’s cloud revenues still trail behind industry leaders. Amazon Web Services posted an annual run rate of $124 billion, while Microsoft Azure reported $75 billion, compared to Oracle's cloud revenue run rate of $29 billion as of this update[1][3]. However, Oracle’s market capitalization has benefited from the upbeat outlook, with shares rising nearly 45% year-to-date and pushing its market cap beyond $800 billion[3].
Expanding Multicloud and Artificial Intelligence Capabilities
Oracle CTO Larry Ellison highlighted explosive growth in multicloud database revenues, especially from partnerships with Amazon, Google, and Microsoft, where annual multicloud revenue grew by more than 1,500% in the first quarter[1]. Oracle expects to further strengthen its multicloud strategy by delivering an additional 37 data centers to its three hyperscaler partners, totaling 71 worldwide[3].
Oracle is also expanding its artificial intelligence portfolio. In July, it signed a major deal with
OpenAI to develop 4.5 gigawatts of U.S. data center capacity under Project Stargate. Oracle incorporated
GPT-5 into its applications in August and plans to introduce an Oracle AI Database service by October, enabling customers to run AI models directly on their own data[3].
Conclusion
Oracle's aggressive cloud revenue targets and major contract wins underscore the company's accelerating momentum in cloud infrastructure and AI services. While it remains behind the largest players, Oracle’s growing pipeline and strategic investments signal its intent to become a key force in the evolving cloud market.
