Essential Metrics for Oracle's Cloud Infrastructure to Watch This September

2 min read | August 20, 2024 12:00 AM PDT | By Team Kalkine Media

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Essential Metrics for Oracle's Cloud Infrastructure to Watch This September — Image source: Shutterstock

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Oracle's AI data centers face high demand due to their advanced infrastructure.
The company's Cloud Infrastructure (OCI) segment has seen impressive revenue growth.
Upcoming financial reports will provide insight into future performance.

Oracle (NYSE:ORCL) has consistently been at the forefront of technological advancements. Over the past 25 years, Oracle has been instrumental in guiding businesses through the evolution of the internet, cloud computing, and now, artificial intelligence (AI).

The company boasts some of the most advanced AI data center infrastructure available, allowing developers to utilize up to 32,768 of (NASDAQ:NVDA) Nvidia's graphics processing units (GPUs), surpassing many competitors. This extensive GPU capability supports the development of larger AI models. Additionally, Oracle's random direct memory access (RDMA) networking technology facilitates faster data transfer compared to traditional Ethernet networks, leading to significant cost efficiencies as developers are billed by computing capacity used.

According to Chairman Larry Ellison, Oracle's Gen2 AI data centers can train AI models twice as quickly and at half the cost compared to rival infrastructures.

The company offers data center capacity through its Cloud Infrastructure (OCI) segment, which has seen more than 40% year-over-year revenue growth for the past four quarters, making it the fastest-growing segment within Oracle. Projections indicate that OCI revenue growth could exceed 50% for fiscal 2025. Oracle will disclose its first-quarter results (ending August 31) in early September, making it crucial to monitor this segment closely.

The potential for accelerated growth in the coming quarters is high, as the demand for Oracle's infrastructure currently exceeds its supply. This was highlighted by the company's remaining performance obligations for fiscal 2024, which surged 44% to a record $98 billion, including $12.5 billion in contracts from over 30 AI firms.

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