We first wrote about Oracle in March 2024 in a report subtitled “Largest database vendor and second largest enterprise software company.” It can be found here.
Subsequent reports on Oracle can be found here and here.
We revisit the company in the light of the Q4 2025 Results
We noted the following in our introduction to the September 2024 note on Oracle.
Oracle (ORCL) is the largest global provider of database software and the second largest supplier of enterprise software. Oracle offers ~1,000 software products and has acquired over 140+ companies of all sizes and types. In general, apart from their database software and ecosystem, which was developed in-house, most of their offerings were developed by companies acquired by Oracle.
Gartner estimates that ORCL is the second largest vendor (behind Microsoft) in the Enterprise Software space with a 9% market share. It has more than 400,000 customers, including 300,000+ customers for its flagship Oracle database offering, deployed across a variety of industries. These are very big numbers and testament to the longevity of the company and its broad multi-industry penetration.
ORCL used the vast cashflows from its very profitable database businesses to acquire other large tech companies including Peoplesoft, BEA Systems and Sun Microsystems among others.
Most enterprises of any size established before, say the year 2000, will be running Oracle Databases on on-premises infrastructure. While many workloads may have moved to the Cloud, for most established companies, moving core database infrastructure was too difficult to contemplate. Companies kept running them on their premises, locked-in to Oracle’s system and hostage to their frequent and aggressive price increases.
In the last two decades, there has been a huge growth in companies migrating their data and workloads to the Cloud where they are hosted by the hyperscalers. This is a pay as you go system. Investing upfront in large on-premises infrastructure is increasingly hard to justify.
ORCL initially dismissed the threat to its on-premises database business. In 2009, Oracle founder Larry Ellison used adjectives such “Fad," "Nonsense," and "Gibberish" to describe the Cloud.
In 2010, Amazon was already four years into AWS and Microsoft Azure became available for public use. Ellison’s scepticism started to wane in 2012. Oracle began to offer over 100 applications delivered in cloud-based software as a service model (SaaS).
This pivot has been successful, and Cloud Revenues have grown strongly. The relevant division is called Oracle Cloud Infrastructure (OCI). ORCL described OCI as follows:
“Oracle Cloud is the first public cloud built from the ground up to be a better cloud for every application. By rethinking core engineering and systems design for cloud computing, we created innovations that solve problems that customers have with existing public clouds. We accelerate migrations of existing enterprise workloads, deliver better reliability and performance for all applications, and offer the complete services customers need to build innovative cloud applications.”
They claim that given the large number of software applications, serving a wide range of business functions, the offering can be characterised as Software as a Service (SaaS). As Oracle offers a very wide range of software, it is also known as Platform as a Service (PaaS).
Oracle also ventured into the infrastructure as a service (IaaS) market. In IaaS, ORCL equips and operates datacentres for clients such as enterprises, service providers, government agencies and countries.
Oracle has argued the big hyperscalers, especially Amazon AWS, are trying to impose a closed garden. That is, they want all the clients’ data and workloads just on their Cloud.
Oracle argues clients prefer a hybrid-cloud approach and want to use more than one provider. About two-thirds of companies use multiple clouds, according to a May 2021 report by Boston Consulting Group.
Oracle has established close partnership with all three large Cloud Hyperscalers (Microsoft Azure, Amazon AWS and Google Cloud Platform) and therefore can offer the hybrid cloud to their clients. In other words, clients can run all Oracle applications on the Hyperscalers’ Public Clouds. They do not have to be locked in to the OCI infrastructure.
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Q4 2025 Results
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