Oracle Projects Cloud Sales of $166 Billion by 2030 Amid Expanding Business

Oracle is forecasting its cloud infrastructure revenue will soar to $166 billion by fiscal 2030, potentially accounting for nearly three-quarters of its total sales. The optimistic outlook was shared by CEO Clay Magouyrk during a meeting with financial analysts, who noted that new bookings are coming from a diverse range of clients, not just OpenAI.

CFO Dough Kehring added that Oracle anticipates overall revenue of $225 billion and adjusted earnings of $21 per share by 2030. These projections surpass analysts’ expectations, which had estimated $198.4 billion in total sales and $18.92 in adjusted earnings per share, according to LSEG data.

Following the announcement, Oracle shares rose 3% in regular trading, though they dipped around 2% in after-hours trading after the company detailed broader revenue and profit forecasts.

Oracle has secured hundreds of billions in cloud infrastructure bookings, and separately, is collaborating with OpenAI on a $500 billion project that will include building five new data centers. In its most recent quarter, Oracle’s cloud revenue surged 28% to $7.2 billion.

Magouyrk highlighted that during a single 30-day period last quarter, Oracle Cloud Infrastructure (OCI) booked $65 billion in new commitments. This figure included a $20 billion deal with Meta Platforms, and notably, all seven major deals—spanning four different clients—came from customers other than OpenAI. “I know some people are questioning, ‘Hey, is it just OpenAI?’ The reality is, we think OpenAI is a great customer, but we have many customers,” he said.

Margins and Profitability Outlook

Investor concerns about gross margins were also addressed. Oracle reported a 68.7% gross margin in its latest quarter, though analysts expect a modest decline by fiscal 2027. For AI-focused cloud infrastructure, Oracle anticipates adjusted gross margins of 30% to 40%. In comparison, its traditional cloud software and infrastructure for business customers are projected to maintain margins between 65% and 80%.

The company emphasized that these margins are expected to remain stable over the life of a contract. For example, in a hypothetical six-year, $60 billion AI infrastructure agreement, Oracle would incur approximately $6.4 billion in costs annually, demonstrating predictable profitability even for large-scale deployments.

Summary:

Oracle’s cloud ambitions are scaling rapidly, with forecasts pointing to $166 billion in infrastructure revenue by 2030. Strong bookings from a broad client base, including but not limited to OpenAI, signal growing industry trust. While margins for AI infrastructure are lower than traditional offerings, predictable costs and diversified revenue streams position Oracle for sustained growth in the competitive cloud market.

FAQs: Oracle’s Cloud Revenue and Growth Outlook

1. What is Oracle’s cloud revenue forecast for 2030?

Oracle expects its cloud infrastructure revenue to reach $166 billion by fiscal 2030, accounting for nearly 75% of its total sales.

2. How does Oracle’s overall revenue projection compare to analysts’ expectations?

Oracle forecasts $225 billion in total revenue and $21 in adjusted earnings per share by 2030, surpassing analyst estimates of $198.4 billion in sales and $18.92 per share in adjusted profits.

3. Which clients are driving Oracle’s cloud bookings?

Bookings are coming from a diverse set of clients. While OpenAI is a notable customer, recent large deals also include Meta Platforms and other major organizations, showing broad demand beyond AI-specific projects.

4. How much new cloud business did Oracle book recently?

In a single 30-day period last quarter, Oracle Cloud Infrastructure (OCI) secured $65 billion in new commitments, including a $20 billion deal with Meta. All seven major deals in that period were from clients other than OpenAI.

5. What is Oracle’s gross margin outlook for cloud and AI infrastructure?

For AI-focused cloud infrastructure, Oracle expects adjusted gross margins of 30%–40%. Traditional cloud software and infrastructure for business clients are projected to maintain higher margins between 65% and 80%.

6. Are Oracle’s margins stable over long-term contracts?

Yes. Oracle expects margins to remain steady over the life of contracts. For example, in a hypothetical six-year, $60 billion AI infrastructure deal, annual costs would remain consistent at around $6.4 billion.

7. How did Oracle’s stock react to these projections?

Shares rose 3% during regular trading following the cloud revenue forecast but fell about 2% in after-hours trading after broader revenue and profit guidance was released.

8. What does Oracle’s cloud growth mean for the industry?

Oracle’s aggressive expansion highlights growing enterprise demand for cloud infrastructure, AI capabilities, and long-term digital transformation projects, reinforcing its position as a major competitor in the global cloud market.