Oracle Cloud ERP Gains Market Share, Takes from SAP

Oracle cloud enterprise resource planning (ERP) continued gaining market share during the third quarter amid increasing migration from SAP ERP.

Overall, Oracle reported $10 billion in revenue, up 3% year over year. Profit was $5 billon, up a whopping 95% from the year ago quarter. The company’s ERP resellers are a big part of that.

Cloud services and license support revenue for the quarter was $7.3 billion, up 5%. That was driven by Fusion, Autonomous Database and Gen2 OCI cloud. Fusion ERP grew 30% and NetSuite ERP grew 24% during the quarter.

Safra Catz is Oracle‘s CEO.

Oracle’s Safra Catz

“Oracle’s rapidly growing, highly profitable, multibillion-dollar cloud ERP businesses helped drive subscription revenue up 5% and operating income up 10% in the quarter,” she said. “Subscription revenue now accounts for 72% of Oracle’s total revenues.”

During the quarter, Oracle expanded its cloud portfolio with Oracle Roving Edge Infrastructure. It also developed and delivered a cloud-based national electronic health records (EHR) database, plus a suite of public health management applications. Those are helping U.S. public health agencies and health care providers collect and analyze data related to COVID-19.

In addition, Oracle launched Oracle Database 21c with more than 200 new features.

Stealing from SAP

Larry Ellison is Oracle’s chairman and CTO.

“In [the third quarter] alone, we signed contracts, totaling hundreds of millions of dollars, to migrate several very large SAP ERP customers to Oracle Fusion ERP,” he said. “But this was not just a recent Q3 event. This has been going on for a couple of years.”

Ellison called out SAP, the once-dominant on-premises ERP market leader, as “not competitive” in cloud ERP. It never rewrote its ERP system for the cloud and it’s “too late for them to start now,” he said.

Oracle’s Gen2 Cloud Infrastructure business added customers and grew revenue in excess of 100% during the quarter.

“We are opening new regions as fast as we can to support our rapidly growing multibillion-dollar infrastructure business,” Ellison said. “On the applications front, analysts continue to rank Oracle the clear No. 1 in cloud ERP.”