Oracle disappoints market with revenue miss as Ellison hints at Azure database move
Don't expect 'armies of programmers' to rewrite Cerner, says Larry, talking up low-code app dev platform APEX
Software and hardware giant Oracle disappointed the stock markets with slightly less than expected revenue for Q1 of 2024, while CTO Larry Ellison teased a closer alliance with Microsoft and its Azure cloud platform.
Big Red posted $12.45 billion in sales for the opening three months of its fiscal 2024 ended August 31, up nine percent year-on-year. However, analysts had expected a figure of $12.47 billion. The disappointment was reflected in a 9 percent share price slide, wiping around $30 billion off the corporation's market value.
Q1 cloud revenue, which includes IaaS plus SaaS, was $4.6 billion, up 30 percent on last year, while SaaS revenue alone was $3.1 billion, up 17 percent. Operating margins hit 26 percent, up from 23 percent in the same period last year.
Founder and CTO Larry Ellison said Oracle's database business was set to make an announcement with Microsoft later this week. "We will be substantially expanding our existing multi-cloud partnership with Microsoft by making it easier for Microsoft Azure customers to buy and use the latest Oracle Cloud database technology in combination with Microsoft Azure Cloud Services," he said.
Oracle bought health records software company Cerner for $28 billion in June 2022, promising an expansion of its health sector of activity.
The move was followed by a round of job cuts at the electronic patient records company.
CEO Safra Catz told analysts Oracle would continue to try to make savings in its Cerner business.
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"As we continue to benefit from economies of scale in the cloud and drive Cerner profitability to Oracle standards, we will not only continue to grow operating income, but we will also grow the operating margin percentage," she said on a call.
Ellison said Oracle was re-writing Cerner's Millennium software for Oracle Cloud Infrastructure, but that much of the code was generated through automation.
"With Cerner, the rewrite of Cerner, it's not armies of programmers that are going to be rewriting this. We are generating the new Millennium software using [low-code application development platform] APEX, and that's also going to save us a lot of human labor and generate higher-quality code and higher-quality user interfaces and better security, all at once," he told investors. ®