Oracle is expanding its AI strategy across its Oracle Cloud Infrastructure and its application businesses as surging cloud demand, AI agents, multi-cloud database growth and strong fiscal 2027 guidance help reshape its enterprise technology moves.
Oracle is using AI to recast both sides of its business, pairing a massive cloud infrastructure buildout with an increasingly agent-driven application strategy as it looks to turn surging enterprise demand into faster deployments, deeper customer adoption and stronger financial growth.
This look at Oracle’s business came from Oracle’s two co-CEOs, Clay Magouyrk and Mike Sicilia, who Thursday discussed the company’s latest changes and upcoming plans with analysts during its first fiscal quarter 2027 quarterly financial analyst call.
On the Oracle Cloud Infrastructure, or OCI, side, Magouyrk said Oracle is accelerating delivery of AI capacity, GPUs and multi-cloud database services while expanding its ability to connect models, enterprise data and developer workflows across OCI and other major clouds.
[Related: Oracle Q4 Earnings: Cloud, AI Surge As Spending Spikes]
On the application side, Sicilia positioned AI agents as a way to make Oracle’s SaaS, industry applications, NetSuite and health-care offerings easier to implement and more valuable in day-to-day business workflows and said customers are already ramping up usage of embedded AI and production agents.
Oracle Cloud Infrastructure
Magouyrk said OCI’s AI infrastructure buildout has shifted into an increasingly faster execution phase, with Oracle delivering 850 megawatts of AI capacity and more than 300,000 GPUs to customers since the end of the fourth fiscal quarter. He said that pace reflects years of investment across data center design, supply chain execution, manufacturing, installation and operations, and said that over $30 billion in new AI contracts closed in the first quarter without requiring additional Oracle capital.
“Our ability to operate a large multitenant fleet remains a significant advantage,” Magouyrk said. “GPU utilization remains extremely high at 97.9 percent in Q1. GPU longevity and value continue to impress. Of all the GPUs that came up for renewal in Q1, that capacity was renewed or resold at a 20 percent premium to prior contracts.”
Oracle’s Abilene, Texas, campus was central to that infrastructure story, with the company delivering 131,000 GPUs there in the first quarter, nearly twice fourth quarter’s volume, Magouyrk. Six of eight campus buildings, representing 618 megawatts and 75 percent of planned capacity, have been delivered to customers, and acceptance times have been compressed to 24 hours. He also said Oracle’s next gigawatt-scale campus being built in the West Texas county of Shackelford is progressing.
Oracle also expanded the cloud foundation surrounding that AI infrastructure, Magouyrk said. Multi-cloud database revenue rose 353 percent year over year, the number of customers grew 180 percent, and Oracle completed its planned Microsoft Azure and Amazon Web Services regional expansion, reaching 70 multi-cloud database regions and 119 availability zones. He also said Oracle Interconnect for AWS is now generally available, giving OCI private, high-speed links to all hyperscalers with no data transfer charges and strengthening Oracle’s ability to connect AI workloads to enterprise data wherever customers run them.
“We are placing Oracle AI Database in every major cloud and making more proprietary and open models available on OCI,” he said. “We are then connecting those models to enterprise data, applications and developer workflows. That combination is why demand continues to grow and why we remain confident in the long-term value of the technology we are building.”
Looking ahead, Magouyrk pointed to infrastructure enhancements meant to connect AI capacity, models and enterprise data more tightly. Oracle expanded OpenAI access through Marketplace, is bringing Google Gemini models to Oracle enterprise applications, released new Grok models and added more open-source models, he said.
Oracle also unveiled a multiyear Quantinuum partnership to run Helios quantum computers in a U.S.-based OCI AI data center, a step aimed at supporting hybrid quantum and AI workloads on Oracle infrastructure, Magouyrk said.
Oracle APEX 26.1 and the Oracle AI Data Platform extend that infrastructure into developer and data workflows, with AI coding agents, Codex and Cloud Code integration, advanced machine learning operations, business knowledge models, a semantic region engine and deep insight agents designed to add context, semantics, automation and governance to enterprise AI, Magouyrk said.
When asked by an analyst whether a decrease in Oracle capital spending could impact future infrastructure growth, Magouyrk said the company has invested very heavily in relationships with different suppliers and vendors and invented new business models including bring-your-own hardware, all of which help spread out that capital.
“I think that we have to separate out in our minds what Oracle spends as CapEx directly [and] uncouple that directly from how we think about how the business can grow because from our perspective, I think we see ways that clearly capital is still required to do this work, but it doesn’t all have to flow from the Oracle side.”
After another analyst asked about the impact Oracle might see from delays in its Wisconsin and New Mexico data center builds, Magouyrk said that while those two did not deliver capacity in the first quarter, neither did the company’s Shackelford or Michigan data centers.
“I would make sure everybody understands [that] when these large sites are built, they don’t all come online at once,” he said. “Let’s say that you have a gigawatt site, and it’s supposed to start delivering let’s say in in January of a year. It’s not like in January you get a gigawatt of capacity. It’s phased over many quarters, so it’s not as though if you have a delay compared to a plan in one site that you have some massive thing that hits in a single quarter. And then the other thing I would say is, anyone that’s been in the business of doing large-scale infrastructure development if their plan relies on 100 percent achievement of every one of their deliverables, we have a term for that. It’s called a ‘bad plan.’ And so we try real hard not to make bad plans.”
Oracle Applications
Oracle is betting that the next wave of enterprise AI will run through the business applications customers already depend on, with Sicilia casting agents as a way to make Oracle’s packaged suites more automated, easier to deploy and more valuable across industry-specific workflows.
Before AI, Sicilia said, application suites already helped companies improve margins through standardized end-to-end automation, but customers often struggled to keep teams and regions aligned with prescribed processes. AI agents changed that by executing tasks within those existing rules, while employees supervise, handle exceptions and apply judgment, he said.
“By combining applied AI with decades of sophisticated business rules, regulatory compliance, security models, data models and customer configurations, we enable customers to continuously realize AI’s value while keeping their data secure and their operational guardrails intact,” he said. “This allows organizations to harness the power of our application suites more easily than ever before. We are incredibly confident in the potential for this new paradigm to deliver much more rapid ROI for our customers.”
Sicilia pointed to the next phase of Oracle’s application plans, including an agentic AI accelerator to be unveiled at AI World in October. The goal, he said, is to simplify and speed Oracle SaaS deployments by using agents to automate and orchestrate implementation alongside Oracle and customer teams, compressing timelines from years to months and from months to weeks.
Oracle’s application business also posted growth in the quarter, with SaaS up 10 percent, Fusion up 14 percent, Oracle Health accelerating and industry applications growing more than 20 percent over last year, Sicilia said. Embedded AI usage is rising quickly, he said. Customers used Oracle’s embedded AI more than 150 million times in the quarter, AI agents ran more than 3.5 million times in production, and Fusion AI usage consumed 900 billion tokens.
“I think it’s fair to say that customers are using our AI built into our Fusion applications and our application stack every day,” he said.
Oracle has also just unveiled the general availability of its new AI-powered offering called NetSuite Next, which Sicilia said presents a simple and powerful agentic experience infused with AI across the workflows that customers rely on every day.
Sicilia said NetSuite Next is designed to be easier to adopt, more productive immediately and more valuable as customers grow. He also cited the NetSuite AI connector service, already used by more than 10,000 customers, as one of the fastest-adopted capabilities in NetSuite’s history.
In health care, Oracle plans to debut an agentic care management system connecting clinical research and care delivery, easing records management and putting AI at the user interface so providers can focus more on patients than computer systems, Sicilia said.
Oracle Cloud Infrastructure Growth On Database Base: Partner
Over the last year, there has been a lot of focus on the importance of processing power in regard to AI, but in order for AI models to work properly they need access to data, and that’s where Oracle comes in, said Scott Morrell, CEO of Centroid Systems, a Troy, Mich.-based cloud services provider and longtime Oracle channel partner.
Morrell told CRN that Gartner and other sources point to about 80 percent of the world’s largest companies having data in Oracle databases.
“And so very quickly you realize that just as important as the processing power is the data, and that data is already sitting in Oracle. … Do I transport my data from wherever it is to whatever AI tool I’m going to use or is it better to bring the AI tool to the data?” he said. “And that’s where OCI really excels. And that’s not even to mention the security concerns. There’s a ton of press out there and examples where corporate data has been basically available for anybody to use because people are not deploying AI properly, and OCI is set up out of the box and was architected with this in mind.”
Taking in the considerations of security and the advantage of moving compute to the data, clients quickly realize it’s better to have their data in a predesigned and architected solution in OCI, Morrell said.
“Get their data there, and then use the existing AI layer there,” he said. “And their data is already in an Oracle database. And to the growth I was speaking of earlier, that’s exactly what we’re seeing. It gets very expensive to start to move massive quantities of data constantly with egress charges to have AI models work outside of where most of your data is contained.”
Oracle By The Numbers
For its first fiscal quarter 2027, which ended Aug. 31, Oracle reported total revenue of $19.35 billion, up about 30 percent over the $14.93 billion the company reported for its first fiscal quarter 2026.
That included cloud revenue of $11.61 billion, up 62 percent over last year; software revenue of $5.55 billion, down 3 percent; hardware revenue of $774 million, up 15 percent; and services revenue of $1.41 billion, up 5 percent.
The Americas market accounted for $13.71 billion, up from last year’s $9.66 billion.
Total revenue beat analyst expectations by $220 million, according to Seeking Alpha.
The company also reported GAAP net income for the quarter of $4.76 billion, or $1.56 per share, up from the $2.93 billion, or $1.01 per share, it reported for last year.
On a non-GAAP basis, Oracle reported net income of $5.84 billion, or $1.92 per share, up from $4.28 billion, or $1.47 per share.
Oracle beat analyst net income expectations by 18 cents per share, according to Seeking Alpha.
Looking ahead, Oracle expects second fiscal quarter 2027 revenue to grow between 30 percent and 34 percent, with cloud revenue expected to grow between $65 percent and 71 percent. For all of fiscal 2027, Oracle expects revenue to reach at least $90 billion and non-GAAP earnings of $8.10 per share.
Wade Millward contributed to this story.