Oracle’s inventory is lastly catching up with its discuss cloud, fueled by surging infrastructure and AI demand. In its latest This fall 2025 earnings assertion, the 46-year-old database big stunned Wall Road with an 11% bounce in income (to $15.9 billion) and bullish forecasts for the yr forward. Oracle’s inventory promptly loved its greatest week since 2001, leaping 24%. It’s comparatively straightforward to please (and idiot) buyers, however there’s actual substance in that 11% bounce, and that substance is, at its basis, all about information.
That is new for Oracle. I and others have criticized the corporate for being too gradual to embrace cloud. In consequence, each Microsoft Azure and Amazon Net Providers pulled forward of Oracle in database income a number of years again as cloud grew to become central to enterprise technique.
Oracle, nonetheless, discovered a workaround.
For many years, Oracle Database has been the guts of the enterprise. It’s the system of report for a lot of the world’s most crucial information. As a substitute of competing head-on with the likes of OpenAI and Google on basis fashions, Oracle is providing one thing way more sensible to its enterprise prospects: the flexibility to run AI securely on their very own information, inside their very own cloud surroundings. The brand new Oracle Database 23ai is a testomony to this technique, integrating AI capabilities straight into the database in order that corporations can get insights from their information with out having to ship it off to a third-party service.
It’s sensible, but it surely’s additionally not sufficient. Sustaining Oracle’s newfound momentum could require Oracle to achieve an space the place it has traditionally struggled: profitable over builders. Builders, in spite of everything, are the individuals constructing the functions that may draw on all that Oracle information.
Cloud-based AI favors database distributors
Giant language fashions (LLMs) have wowed us for the previous few years with all they might do with large portions of publicly out there information (even when the unwitting information suppliers, like Reddit, haven’t all the time been blissful about that function). They’ve began to stumble, nonetheless, en path to true enterprise adoption, hampered by safety considerations and the truth that as knowledgeable as they’re by the web, they’re extremely dumb relating to a given enterprise as a result of they’ve zero entry to that information. Corporations have tried to get round this drawback with retrieval-augmented era (RAG) and different techniques, however the true bonanza is ready for the businesses that may assist enterprises apply AI to their information with out having that information go away their secured infrastructure, whether or not operating on premises or within the cloud.
A couple of distributors are figuring it out. Certainly, I’ve had a front-row seat to this phenomenon at MongoDB, the place corporations are discovering it helpful to retailer and search vector embeddings alongside operational information. Oracle is outwardly discovering one thing related, as famous on its earnings name, and is lastly spending large on information facilities to maintain up with rising demand ($21 billion this yr, which is greater than 10 occasions what it was simply 4 years in the past).
Unsurprisingly, Oracle founder and CTO Larry Ellison couldn’t resist a little bit of grandstanding on the earnings name, successfully arguing that relating to enterprise AI, Oracle has a home-field benefit. “These different corporations say they’ve all the info, to allow them to do AI very well…. The one drawback with that assertion is that they don’t have all the info. We do. We’ve got many of the world’s helpful information. The overwhelming majority of it’s in an Oracle database.” It’s traditional Ellison swagger, however there’s fact there: Oracle databases stay ubiquitous in giant enterprises, storing troves of business-critical information.
Oracle is leveraging that place by making its database and cloud companies “AI-centric.” Oracle’s pitch is that enterprises can use the info already sitting of their Oracle apps and databases to achieve AI-driven insights securely and reliably with out having emigrate all the things to some new (and certain much less safe) AI platform. “We’re the important thing enabler for enterprises to make use of their very own information and AI fashions,” Ellison argues. “Nobody else is doing that…. This is the reason our database enterprise goes to develop dramatically.”
In Oracle’s view, the true gold rush in enterprise AI isn’t simply hyping up the biggest common AI fashions, however serving to corporations apply AI to their very own information. Oracle has additionally been a bit much less Oracle-like by embracing multicloud. Somewhat than insisting all workloads run on Oracle’s cloud (Oracle Cloud Infrastructure, or OCI), the corporate has inked partnerships to make Oracle Database out there on AWS, Google Cloud, and Microsoft Azure. For enterprises involved about information sovereignty, latency, or simply avoiding single-vendor lock-in, that’s a lovely story.
But it surely’s not but a whole story. For that, Oracle wants to determine builders.
The lacking piece
Eleven years in the past I known as out the lacking piece in Oracle’s cloud ambitions: “Oracle … has constructed a cloud for its present prospects however not for builders who’re constructing large information, web of issues, cellular, and different fashionable functions.” I doubled down on this theme, insisting that Oracle had did not treatment “an virtually full lack of curiosity from builders.”
Plus ça change…
Oracle’s cloud progress to this point has come largely from promoting to the CIO, not the developer, signing large offers with corporations that already belief Oracle for databases or apps, serving to prospects migrate present Oracle-centric workloads, and so on. That’s a superbly legitimate technique (and a profitable one), but it surely leaves Oracle underexposed to the grassroots innovation occurring within the broader developer neighborhood. Why does developer enthusiasm matter if Oracle can maintain signing enterprise contracts? As a result of within the cloud period, builders are sometimes the new enterprise kingmakers driving know-how adoption.
Certain, the CIO of a big financial institution would possibly signal a top-down cope with Oracle for an ERP system or database licenses, but it surely’s the builders and information scientists who’re dreaming up the following era of functions—those that don’t even exist but. They’ve a world of cloud choices at their fingertips. In the event that they aren’t pondering of Oracle as a platform to create on, Oracle dangers lacking out on new workloads that aren’t already tied to its legacy footprint.
A modest proposal
It’s not my job to inform Oracle the best way to get its developer act collectively, however there are some apparent (if troublesome) issues it could actually and will do. Oracle doesn’t have to change into “cool” in a Silicon Valley startup sense, but it surely does have to decrease boundaries so {that a} curious engineer or a small group can readily select Oracle (together with MySQL) for his or her subsequent mission. For instance, years in the past Oracle ceded MySQL’s dominant open supply pole place to Postgres. It’s unclear whether or not the corporate would ever contemplate an open governance mannequin for MySQL, however that could be the one technique to put MySQL on equal footing. MySQL has nice engineering, but it surely wants neighborhood.
Much less culturally troublesome, Oracle must maintain enhancing onboarding and pricing to make it straightforward for builders to select its cloud. One factor that made AWS in style with builders was the flexibility to swipe a bank card and get going instantly, with clear usage-based pricing. Oracle has made progress right here. OCI has a free tier and simple pricing for a lot of companies, however it could actually go additional. For instance, providing beneficiant free credit for startups, particular person developer accounts, or open-source initiatives might additionally seed grassroots adoption.
Oracle also needs to take a cue from Microsoft and improve its presence in developer communities and conferences, spotlight success tales of “constructed on OCI” startups, and develop applications that interact builders straight. Oracle has began shifting on this route. At its CloudWorld 2024 convention, Oracle unveiled Oracle Code Help (an AI-powered programming assistant for Java builders on OCI) and new options in its Oracle Kubernetes Engine to higher help cloud-native apps and AI workloads. These are welcome additions. The hot button is to get such instruments into builders’ palms and iterate based mostly on suggestions, which could possibly be completed by an emboldened developer advocacy group.
Lastly, Oracle ought to bundle its distinctive strengths in a means that enables builders to simply faucet into them. For example, Oracle’s experience in databases and information administration could possibly be supplied as developer-friendly companies. The corporate’s new Oracle Database 23c has “AI” options (JSON relational duality, vector search, and so on.) that sound nice, however Oracle wants to make sure a developer can shortly provision a growth occasion of this database, load some information, and name an API or driver to begin constructing an AI-powered app. Briefly, Oracle ought to make its cool tech simply accessible. If Oracle can provide builders a style of what its high-performance cloud and information programs can do—with no months-long enterprise procurement cycle—some will inevitably be impressed and advocate utilizing Oracle for brand spanking new initiatives.
Oracle is reaching one thing uncommon: a real second act in tech, many years into its life. By leaning into what it does greatest (databases, enterprise functions, and now high-performance cloud infrastructure) Oracle has made itself a contender within the age of AI. The following check might be whether or not the corporate can broaden its affect past the standard enterprise IT outlets which have all the time been its stronghold. If Oracle can discover a technique to interact builders on their very own phrases (with out diluting its enterprise savvy), it might unlock one other degree of progress that makes at the moment’s resurgence look modest.
