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Oracle’s inventory is lastly catching up with its discuss cloud, fueled by surging infrastructure and AI demand. In its recent Q4 2025 earnings statement, the 46-year-old database large shocked Wall Road with an 11% leap 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% leap, and that substance is, at its basis, all about knowledge.
That is new for Oracle. I and others have criticized the corporate for being too gradual to embrace cloud. Consequently, each Microsoft Azure and Amazon Internet Companies pulled forward of Oracle in database income a number of years again as cloud turned central to enterprise technique.
Oracle, nonetheless, discovered a workaround.
For many years, Oracle Database has been the center of the enterprise. It’s the system of file for a lot of the world’s most important knowledge. 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 knowledge, inside their very own cloud setting. 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 knowledge 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 might require Oracle to achieve an space the place it has traditionally struggled: successful over builders. Builders, in spite of everything, are the folks constructing the functions that can draw on all that Oracle knowledge.
Cloud-based AI favors database distributors
Large language models (LLMs) have wowed us for the previous few years with all they may do with large portions of publicly out there knowledge (even when the unwitting knowledge suppliers, like Reddit, haven’t at all times been blissful about that function). They’ve began to stumble, nonetheless, en path to true enterprise adoption, hampered by safety considerations and the fact that as knowledgeable as they’re by the web, they’re extremely dumb in relation to a given enterprise as a result of they’ve zero entry to that knowledge. Firms have tried to get round this downside with retrieval-augmented generation (RAG) and different ways, however the actual bonanza is ready for the businesses that may assist enterprises apply AI to their knowledge with out having that knowledge go away their secured infrastructure, whether or not operating on premises or within the cloud.
Just a few 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 knowledge. Oracle is outwardly discovering one thing comparable, as famous on its earnings name, and is lastly spending large on knowledge facilities to maintain up with rising demand ($21 billion this yr, which is more than 10 times what it was just four years ago).
Unsurprisingly, Oracle founder and CTO Larry Ellison couldn’t resist a little bit of grandstanding on the earnings name, successfully arguing that in relation to enterprise AI, Oracle has a home-field benefit. “These different corporations say they’ve all the info, to allow them to do AI rather well…. The one downside with that assertion is that they don’t have all the info. We do. We’ve got many of the world’s beneficial knowledge. The overwhelming majority of it’s in an Oracle database.” It’s traditional Ellison swagger, however there’s reality there: Oracle databases stay ubiquitous in giant enterprises, storing troves of business-critical knowledge.
Oracle is leveraging that place by making its database and cloud providers “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 every little thing 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 knowledge and AI fashions,” Ellison argues. “Nobody else is doing that…. That is why our database enterprise goes to develop dramatically.”
In Oracle’s view, the actual gold rush in enterprise AI isn’t simply hyping up the biggest normal AI fashions, however serving to corporations apply AI to their very own knowledge. Oracle has additionally been a bit much less Oracle-like by embracing multicloud. Reasonably 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 knowledge sovereignty, latency, or simply avoiding single-vendor lock-in, that’s a pretty story.
Nevertheless it’s not but a whole story. For that, Oracle wants to determine builders.
The lacking piece
Eleven years in the past I called out the missing piece in Oracle’s cloud ambitions: “Oracle … has constructed a cloud for its current prospects however not for builders who’re constructing large knowledge, internet of things, cellular, and different trendy functions.” I doubled down on this theme, insisting that Oracle had didn’t treatment “an nearly full lack of curiosity from builders.”
Plus ça change…
Oracle’s cloud progress to date 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 current Oracle-centric workloads, and so on. That’s a wonderfully legitimate technique (and a profitable one), but it surely leaves Oracle underexposed to the grassroots innovation occurring within the broader developer group. 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.
Positive, the CIO of a big financial institution would possibly signal a top-down take care of Oracle for an ERP system or database licenses, but it surely’s the builders and knowledge scientists who’re dreaming up the following technology 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 way to get its developer act collectively, however there are some apparent (if troublesome) issues it will possibly and will do. Oracle doesn’t must develop into “cool” in a Silicon Valley startup sense, but it surely does must decrease boundaries so {that a} curious engineer or a small workforce can readily select Oracle (together with MySQL) for his or her subsequent venture. 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 take into account an open governance mannequin for MySQL, however that could be the one strategy to put MySQL on equal footing. MySQL has nice engineering, but it surely wants group.
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 easy pricing for a lot of providers, however it will possibly go additional. For instance, providing beneficiant free credit for startups, particular person developer accounts, or open-source initiatives may 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 increase packages that interact builders straight. Oracle has began transferring on this course. At its CloudWorld 2024 convention, Oracle unveiled Oracle Code Assist (an AI-powered programming assistant for Java builders on OCI) and new options in its Oracle Kubernetes Engine to higher assist cloud-native apps and AI workloads. These are welcome additions. The bottom line is to get such instruments into builders’ fingers and iterate based mostly on suggestions, which may very well be completed by an emboldened developer advocacy workforce.
Lastly, Oracle ought to bundle its distinctive strengths in a manner that enables builders to simply faucet into them. For example, Oracle’s experience in databases and knowledge administration may very well be supplied as developer-friendly providers. 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 rapidly provision a improvement occasion of this database, load some knowledge, and name an API or driver to begin constructing an AI-powered app. In brief, Oracle ought to make its cool tech simply accessible. If Oracle may give builders a style of what its high-performance cloud and knowledge 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 attaining 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 subsequent check will likely be whether or not the corporate can broaden its affect past the normal enterprise IT outlets which have at all times been its stronghold. If Oracle can discover a strategy to interact builders on their very own phrases (with out diluting its enterprise savvy), it may unlock one other stage of progress that makes at this time’s resurgence look modest.
