Oracle's Cloud Revenue Surges 100% as AI Demand Drives Growth

Oracle, a leading cloud service provider, has announced the signing of multiple large-scale cloud service agreements. One of these agreements is projected to generate over 300 billion in annual revenue starting from the 2028 fiscal year. This significant contract, along with others, has contributed to a robust start for Oracle's 2026 fiscal year, with multi-cloud database revenue growth exceeding 100%.

The company's CEO emphasized the strong performance in the cloud services sector, noting that the new contracts, including the one expected to generate over 300 billion in annual revenue, have not impacted the company's financial guidance for the 2026 fiscal year. This indicates that Oracle is well-positioned to maintain its strong performance in the cloud services market.

Oracle's strategic focus on cloud services has been validated by the significant growth in multi-cloud database revenue. The company's ability to secure large-scale cloud contracts demonstrates its leadership in the cloud services industry. These developments have not affected Oracle's financial outlook for the 2026 fiscal year, indicating confidence in its ability to continue delivering strong financial performance.

Oracle's leadership in the cloud services industry is further supported by its role as a preferred third-party cloud service provider for leading AI model companies. The company has established a strong partnership with NVIDIA, a major AI chip manufacturer. According to Oracle executives, four out of the five top AI language model manufacturers use Oracle's data centers. This strategic positioning in the AI era has solidified Oracle's competitive advantage in the cloud infrastructure market.

Oracle's transition from a traditional database business to a cloud-based infrastructure has been a lengthy process, spanning nearly 50 years. However, the company's cloud infrastructure business has emerged as a fast-growing alternative to industry giants such as Amazon, Microsoft, and Alphabet. The strong momentum in Oracle's cloud business has driven its stock price to rise by 60% last year, marking its best performance since 1999.

This year, Oracle's stock has shown a V-shaped recovery, falling by approximately 25% from the beginning of the year to mid-April, before rebounding strongly. By June, the stock had gained nearly 20%, resulting in a cumulative increase of over 30% since the start of the year. This performance reflects the dual impact of rapid cloud business growth and surging demand for AI models.

In June, Oracle's stock price surpassed the record high set in December of the previous year, driven by a strong fourth-quarter earnings report. The report highlighted exceptional performance in the SaaS cloud application sector, particularly in core cloud applications such as Fusion ERP and NetSuite. Management expects this momentum to continue into the 2026 fiscal year, fueled by enterprises migrating from on-premises software to the cloud to leverage AI capabilities.

Oracle's financial report for the fourth quarter of the 2025 fiscal year exceeded expectations, particularly in the SaaS cloud application segment. The significant acceleration in growth for core cloud applications, such as Fusion ERP and NetSuite, is expected to continue into the 2026 fiscal year. This acceleration is driven by enterprises migrating to the cloud to utilize AI capabilities, making AI a key catalyst for ERP cloud migration.