Oracle Q1 Earnings Recap: Larry Ellison Highlights AI's Bright Future

Software company Oracle Corp ORCL reported first-quarter financial results after the market close Monday. Here are the key highlights.

What Happened: Oracle reported first-quarter revenue of $12.45 billion, which was up 9% year-over-year. The revenue total beat a Street consensus estimate of $12.46 billion, according to data from Benzinga Pro.

The company reported first-quarter adjusted earnings per share of $1.19, which beat a Street consensus estimate of $1.15.

In the first quarter, cloud revenue totaled $4.6 billion, which was up 30% year-over-year. Cloud Application revenue made up $3.1 billion of the total and was up 17% year-over-year. Cloud Infrastructure revenue made up $1.5 billion of the total and was up 66% year-over-year.

Free cash flow in the first quarter was $5.7 billion, which was up 21% year-over-year.

“Oracle Cloud Infrastructure revenue grew 66% in Q1, much faster than our hyperscale cloud infrastructure competitors,” Oracle CEO Safra Catz said. “Total cloud services revenue, Infrastructure plus Applications, grew 30% to $4.6 billion in the quarter.”

Oracle Cloud Services and License Support revenue now make up 77% of the company’s total revenue, Catz said. 

“This highly-predictable, highly profitable recurring revenue stream – combined with continued expense discipline – drove 16% growth in non-GAAP earnings per share, 21% growth in free cash flow, and $7.0 billion in operating cash flow in the Q1.”

Related Link: Oracle Bull Says Software Giant Sharpening Its AI Edge

What’s Next: Oracle will host a conference call to discuss the results at 5 p.m. ET.

“Is Generative AI the most important new computer technology ever? Maybe!” Oracle Chairman and CTO Larry Ellison said.

“Self-driving cars, molecular drug design, voice user interfaces – billions of dollars are being invested in AI.”

Ellison said AI development companies have signed contracts to purchase over $4 billion worth of Oracle’s Gen2 Cloud.

“That’s twice as much as we had booked at the end of Q4. The largest AI technology companies and the leading AI startups continue to expand their business with Oracle for one simple reason – Oracle’s RDMA interconnected NVIDIA Superclusters train AI models at twice the speed and less than half the cost of other clouds.

ORCL Price Action: Oracle shares are down 4.81% to $120.61 in after hours trading Monday versus a 52-week trading range of $60.78 to $127.54.

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Photo courtesy of Oracle.