Oracle has announced that it expects its cloud infrastructure revenue to grow to $166 billion by 2030. This would make up nearly 75% of the company’s total sales at that time. CEO Clay Magouyrk shared this forecast during a meeting with financial analysts, stating that new business is coming from many customers, not just OpenAI.
“Our forecast for $225 billion in overall revenue and $21 in adjusted earnings per share by 2030 outpaces current analyst expectations,” said Dough Kehring, Oracle CFO.
Oracle’s cloud revenue has grown rapidly, increasing by 28% in the most recent quarter to $7.2 billion. “We booked $65 billion in new commitments in a recent 30-day period, including a massive contract with Meta Platforms,” said Clay Magouyrk. Magouyrk also stated that Oracle’s cloud customer base is broad, with these new bookings made by multiple companies apart from OpenAI.
Profit margins are a key focus for investors. Oracle projected adjusted gross margins of 30% to 40% for the AI cloud infrastructure piece of its business, which is lower than traditional cloud software and services due to the high capital costs involved in building and running AI data centers.
Nevertheless, these margins are expected to remain consistent for the length of the contracts. Other cloud segments, which include more conventional software and infrastructure, are expected to enjoy higher margins of between 65% and 80%.
Oracle’s commitment to AI cloud infrastructure is demonstrated by its ongoing $500 billion collaboration with OpenAI that involves building five new AI data centers to support the growing demand for AI computing power.
Oracle also faces strong competition from AWS, Google Cloud, and Microsoft Azure. Three giants with much larger market shares and a well-established global infrastructure. However, Oracle’s cloud infrastructure business has outpaced industry averages in recent quarters.
This collaboration signals Oracle’s shift into leveraging AI as a differentiator beyond basic cloud services. While AWS and Azure focus on broad multi-cloud ecosystems, Oracle is making deep investments in AI-optimized cloud hardware and software stacks geared towards enterprises with mission-critical needs. Oracle’s edge lies in its legacy strength in enterprise databases and its systematically expanding OCI platform capabilities.
The company’s long-term growth plans rely on continuing to secure large contracts with AI-focused businesses and expanding its cloud offerings. Oracle believes its strong presence in database management and cloud infrastructure places it well to meet the increasing needs of enterprises worldwide.
