Oracle Offers U.S. Government Huge Discounts on Software and Cloud Services

Oracle is offering the US government a 75% discount on its license-based software and a "substantial" discount on its cloud service through the end of November. This is part of the federal government's efforts to modernize through technology and comes as more tech companies compete for federal business. Oracle's cloud business has seen momentum in the past month, with its stock rallying over 40%.

Oracle has announced a substantial agreement with the U.S. General Services Administration (GSA) to provide a 75% discount on its license-based software and a "substantial" discount on its cloud services to the federal government. This deal, which will run through the end of November, is part of the government's broader initiative to modernize its IT infrastructure and reduce costs [1].

The agreement, which was announced on July 7, 2025, eliminates data egress fees for moving existing workloads from Oracle Government Clouds to other cloud service providers' FedRAMP Moderate, High, or DOD IL 4, 5 Clouds. It also offers pricing parity with commercial offerings and access to white-glove migration services for modernizing legacy Oracle services to Oracle Cloud Infrastructure (OCI) [2].

Stephen Ehikian, the acting administrator of the GSA, stated that the agreement marks a significant step forward in the Trump Administration's mission to acquire cutting-edge commercial technologies for federal system modernization. Oracle's advanced database, cloud, and AI solutions are expected to deliver unmatched speed, security, and scalability, which are crucial for transforming how the government manages and secures sensitive data [2].

The deal aligns with the GSA's OneGov strategy, which aims to modernize and streamline federal IT acquisitions through standardized terms and pricing. This initiative has already resulted in discount deals with several firms, including Elastic, Google, Adobe, and Salesforce [1].

Oracle's stock has seen a significant rally in recent weeks, with shares trading lower on Monday following the announcement of the discount deal. The stock dipped more than 2% to $231.79 in early trading, marking a slight pullback after a remarkable 13% surge last week [3]. Despite the temporary dip, long-term investors may view this as a "buy the dip" opportunity, given the potential for increased adoption of Oracle Cloud Infrastructure (OCI) across federal agencies.

The government deal, while offered at a discount, could significantly accelerate the adoption of Oracle's cloud services, creating a substantial and sticky long-term revenue stream. This comes at a time when Oracle's cloud business has seen momentum, with its stock rallying over 40% in the past month [3].

References:
[1] https://meritalk.com/articles/gsa-inks-discount-offer-with-oracle-for-software-cloud-service/
[2] https://www.gsa.gov/about-us/newsroom/news-releases/gsa-to-accelerate-cost-savings-for-government-in-partnership-with-oracle-07072025
[3] https://www.dailychhattisgarh.com/latest/oracle-orcl-stock-dips-on-government-deal-news-taking-a-breather-after-13-surge/4907/