Oracle's Cloud Adoptions Goes Up, Revenues Goes Down

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Oracle’s lineup of cloud products has been widely expanded over the past few years. Oracle has participated in the acquisition of several cloud startups over the years, with one of its most recent being Maxymiser, a marketing cloud product.
All of the work that Oracle has put into selling cloud products has really paid off. Oracle has just released its quarterly numbers, which can interpreted a hundred different ways to Sunday. For example, while Oracle CEOs rave about the increase in adoption of cloud products at Oracle, overall revenues took a hit.
Overall revenues at Oracle didn’t meet analysts expectations as the cloud computing giant brought in $8.45B in the last quarter. That represents a 1.7% hit in overall revenue. Oracle lost nearly $200m in sales for new software licenses, as the company’s revenues shrunk from $1.37B to $1.15B.
What about cloud? Oracle’s platform and software as a service offerings actually increased by an average of 33%. Revenue from Oracle’s cloud offerings reach $451m for the previous quarter. Oracle was able to raise its sales in cloud infrastructure, from $138m to $160m.
“As our cloud business scales-up, we plan to double our SaaS [software-as-a-service] and PaaS [platform-as-a-service] cloud margins over the next two years – starting from 40 percent this just completed quarter, to approximately 60 percent this coming fourth quarter, and then on up to 80 percent two years from now,” Oracle co-CEO Mark Hurd said in a release.
Some analysts argue that Oracle’s numbers were impacted by the strength of the US dollar compared to other international currencies. Others say that cloud revenues will need time to accumulate for it to actually show on the balance sheets. If Co-CEO Mark Hurd’s¬†prediction that cloud sales revenue would grow over 60% comes true, Oracle will likely begin hitting their quarterly revenue goals which will continue to help promote Oracle’s lineup of cloud products in the future.

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