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Oracle Cloud Revenues Growing

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Oracle sees a silver lining in the cloud that will help to drive revenues forward. Oracle reported its fourth quarter fiscal 2014 earnings on June 19, showing clear momentum in the cloud.

For the quarter, Oracle reported revenue of $11.3 billion for a three percent year-over-year gain. For the full fiscal 2014 year, Oracle revenues also grew by three percent, coming in at $38.3 billion. Of particular note, is Oracle’s cloud businesses which starting with the fourth quarter are now reported differently.

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“What we previously reported as new software license and cloud subscription is now reported on two separate lines; new software license and another line for cloud Software-as-a-Service and Platform-as-a-Service, SaaS and PaaS,” Safra Catz, Oracle President and CFO said during her company’s earnings call.

Catz noted that in the fourth quarter, Cloud SaaS and PaaS revenues were $327 million, growing 23 percent, while Cloud Infrastructure-as-a-Service revenue was $128 million, growing 13 percent.

Looking forward, Oracle is expecting even more growth in the cloud. For the first quarter of its fiscal 2015 year, SaaS and PaaS revenue is expected to grow between 27 percent to 37 percent. Cloud IaaS revenue is expected to grow between 10 percent to 20 percent.

“Oracle is focused, focused like a laser on one goal over the next few years, becoming the number one company in cloud computing’s two most profitable segments, Software-as-a-Service, SaaS; and Platform-as-a-Service, PaaS,” Oracle CEO Larry Ellison said.

Ellison emphasized that his company has a whole suite of cloud applications and competes with, Workday and SAP.

“As industry analysts build their waves and quadrants they name cloud leaders in specific cloud areas and Oracle today is the leader across more cloud solutions than Salesforce, Workday and SAP combined,” Ellison said.

During the earnings call, Ellison was asked how the Oracle sales team is transitioning to the cloud model, which typically works on a recurring subscription basis, rather than a software licensing basis as is typical for on-premises software. According to Ellison, it doesn’t matter.

“The sales force is motivated by their commissions and we’ve made it commission neutral,” Ellison said. “In other words the sales force doesn’t really care if they sell a license or they sell a subscription, they get paid the same amount in either case.”

Sean Michael Kerner is a senior editor at Datamation and Follow him on Twitter @TechJournalist

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