Disagreement on Oracle Cloud Growth Numbers

Oracle made global news headlines by acquiring several big name cloud companies in 2013. Many analysts are starting to wonder if these multi-billion dollar bets are paying off as much as Oracle anticipates.

At the beginning of 2014, Oracle CEO Larry Elison was quoted as saying, “We think these three product areas—database, cloud applications [bookings up 35%], and engineered systems [bookings up almost 35%]—will drive Oracle’s growth in calendar 2014.”
While growth has been projected at 35% by Oracle insiders, outsiders such as Peter Goldmacher seem to think that growth will be much lower. Goldmacher is an investment analyst at Cowen and he has tracked Oracle’s SEC filings to get a clearer picture of this 35% growth curve projected by Ellison. The numbers that Goldmacher has formulated have him convinced that Oracle’s cloud numbers are ambitious at best.
Goldmacher wrote an investment memo on Oracle saying, ”We believe Fusion has been growing about 10 percent over the last year and the acquired cloud assets are growing single digits.”
While Goldmacher and Ellison may dispute each other on the actual numbers, Oracle does indeed have several key advantages in the cloud market due to their acquisitions. Oracle is one of the only major vendors to offer IaaS, PaaS and SaaS solutions for clients. This shift in strategy has taken Oracle out of direct competition with companies such as SAP and IBM. Companies like SalesForce.com are now in the cross-hairs of the database provider.
With Oracle aiming to provide a solution for existing cloud product lineups, as well as inter-connectivity between private and public cloud infrastructures that host Oracle products, the world renowned database giant has positioned itself to earn profits in new verticals that were opened up by their cloud acquisitions. How much profit? The actual numbers still seem to be up for debate. When Oracle begins releasing 2014 financial documents, only then will we know who is a more accurate predictor of Oracle’s future: Ellison or Goldmacher.