Oracle Health's Market Share Declines After Cerner Acquisition: Report

Oracle Health has seen its market share decline substantially after acquiring Cerner, losing 57 unique acute care customers and failing to improve client satisfaction in the past three years. Despite some bright spots, such as improved code quality and new technologies, clients report low satisfaction and a lack of clear communication from the vendor. Competitor Epic has gained market share, controlling over 42% of acute care hospitals in 2024, while Oracle held 23%.

Oracle Health, a division of the technology giant Oracle, has seen a significant decline in its market share in the healthcare sector since acquiring electronic health record (EHR) vendor Cerner in 2022. According to a recent report by Klas Research, the company has lost 57 unique acute care customers in the past three years, with 12 of these being larger health systems. This decline has occurred despite some improvements in the company's technology offerings and increased customer confidence in Oracle's long-term vision.

The report highlights several challenges faced by Oracle Health. The acquisition of Cerner brought with it a dissatisfied customer base, and the company has struggled to turn this around. Clients have reported issues such as a lack of clear communication, insufficient industry knowledge due to layoffs, and an increased focus on collections rather than client needs. As a result, half of the customers interviewed in the report indicated they would not purchase the EHR again in 2024.

Oracle's competitor Epic has capitalized on these challenges, gaining market share among hospitals. As of 2024, Epic controls more than 42% of acute care hospitals, while Oracle's share stands at 23%. The report also notes that Oracle's perception as a long-term partner has declined, with only 47% of customers viewing the vendor as such in the first quarter of 2025, compared to 67% in the second quarter of 2022.

However, there are some positive developments. Clients have reported improved code quality in new releases and are excited about Oracle's new technologies, such as the Clinical AI Agent. This AI agent automatically drafts patient documentation and suggests next steps, and early adopters have expressed satisfaction with the product. Oracle is also embedding AI more deeply into its new EHR, launched for ambulatory providers earlier this month. Despite these advancements, most clients remain uncertain about adopting the AI-backed EHR, with only 24% expecting to go live in the next two to three years.

Oracle Health's market share decline underscores the challenges of integrating a large, established vendor like Cerner into a new company structure. The company will need to address client concerns and improve its communication and industry knowledge to regain its footing in the healthcare sector.

References:
[1] https://finance.yahoo.com/news/oracle-health-market-share-declined-102700307.html