Oracle’s Ellison Touts New AWS Partnership, Says AI Is ‘An Ongoing Battle For Technical Supremacy’

Oracle and AWS unveiled the partnership just ahead of Oracle’s first fiscal quarter earnings call, during which Oracle Chairman and CTO Larry Ellison gave a bullish account of the AI market.

Oracle has inked a partnership with Amazon Web Services, creating Oracle Database@AWS, and revealed the general availability of Oracle Database@Google Cloud as the artificial intelligence boom continues.

The Austin, Texas-based database product giant and AWS revealed the partnership just ahead of Oracle’s first fiscal quarter earnings call Monday, during which Oracle Chairman and CTO Larry Ellison gave a bullish account of the AI market.

“If your horizon is over the next five years, maybe even the next 10 years, I wouldn’t worry about, ‘Hey, we’ve now trained all the models we need and all we need to do is inferencing,’” Ellison said on the call. “This is an ongoing battle for technical supremacy that will be fought by a handful of companies and maybe one nation-state … this business is just growing larger and larger and larger. There’s no slowdown or shift coming.”

Oracle First-Quarter 2025

Asked on the call—covering Oracle’s quarter ended Aug. 31—whether the AI market might see less intensive compute needs as AI training gives way to inferencing, Ellison said that “this race goes on forever to build a better and better neural network.”

“The cost of that training gets to be astronomical. When I talk about building gigawatt or multi-gigawatt data centers … the entry price for a real frontier model from someone who wants to compete in that area is around $100 billion,” Ellison said. “That’s over the next four or five years for anyone who wants to play in that game. That’s a lot of money, and it doesn’t get easier.”

Oracle is designing a gigawatt-plus data center that has building permits for three small modular nuclear reactors. Oracle’s biggest data centers measure around 800 megawatts and its smallest data centers are 150 kilowatts. But the vendor is also at work on data centers down to 50 kilowatts.

“This is how crazy it’s getting,” Ellison said. “This is what’s going on.”

Ellison also used Monday’s call to illustrate some compelling AI use cases in health care, including his prediction that computers will handle sensitive procedures like measuring infants’ spinal cords and skulls and AI applications updating electronic health records based on what the app hears from a doctor’s conversation with a patient.

Although he focused on AI in health care, Ellison appeared to criticize AI vendors overall for looking to charge separately for AI agents.

“Our applications are going to be primarily ‘AI application everything—’how do you charge separately for everything?” he said. “I find it bewildering when I listen to them talk. I don’t understand what they’re saying.”

AWS, Google Cloud Agreements

In a joint statement, Oracle and Seattle-based cloud giant AWS positioned Oracle Database@AWS as a simpler way to conduct database administration, billing and user support while connecting Oracle data to applications on Amazon Elastic Compute Cloud (EC2), AWS Analytics services, Amazon Bedrock and other AI and machine learning offerings.

Oracle Database@AWS will have a preview release later this year with broader availability in 2025, according to the vendors. Oracle Database@Google Cloud became generally available (GA) for four Google Cloud regions in the U.S. and Europe: U.S. East (Ashburn), U.S. West (Salt Lake City), U.K. South (London) and Germany Central (Frankfurt).

More regions worldwide are expected in the coming months, according to the vendors.

AWS has been a frequent target of criticism by Ellison over the years, perhaps making the alliance more surprising than the one Oracle formed with rival Microsoft. Oracle Database@Azure became GA in December.

“We believe our cloud partnerships with AWS and Microsoft and Google will turbocharge the growth of our database business for years to come,” Ellison said on Monday’s call.

The agreements with the top public cloud providers do not represent Ellison growing sour on private clouds, the CTO made clear Monday.

Teaming up with AWS “will absolutely accelerate database growth in the public cloud, but we expect that private clouds will greatly outnumber public cloud” to avoid security and regulatory issues with sharing a cloud with other tenants, he said.

“We have 162 data centers now. I expect we will have 1,000 or 2,000 or more Oracle Cloud data centers around the world,” he said. “And a lot of them will be dedicated to individual banks or telecommunications companies or technology companies or what have you. Or nation-states, sovereign clouds, all of this other stuff. “

Although Ellison said he can’t predict which will be bigger, public cloud or private cloud, “the good news is we win either way,” he said.

He said Oracle public and private clouds are identical in quality, a difference from competitors he did not name on the call.

CloudWorld Preview

Ellison and CEO Safra Catz offered previews of speeches and news set to come out during the vendor’s annual CloudWorld event, being held in Las Vegas from Sept.9 to 12.

Ellison said on Monday’s call that he will focus on multi-cloud and security, as passwords are going away in favor of facial recognition, fingerprints and biometrics. “That’s why Google Pay is popular and Apple Pay is popular,” Ellison said. “Look at me and recognize me and log me in. Don’t ask me to type in some stupid 17-letter password that someone can steal.”

Ellison also touted Oracle’s new zero trust packet routing technology that should improve network and data security in distributed IT environments.

At the event, he will talk about removing humans from database administration and coding to avoid vulnerabilities and misconfigurations, not just to save costs. “There is a whole new generation of AI-based security systems … that we can use to stop these attacks, but we have to actually deploy the technology,” he said.

Catz said to expect an announcement around embedded AI agents in Fusion to increase productivity.

First Quarter In Detail

Oracle reported $13.3 billion in total revenue for the first quarter of fiscal year 2025, an increase of 8 percent year over year ignoring foreign exchange.

Total remaining performance obligations hit $99 billion, up 53 percent year over year. Cloud revenue for the quarter was $5.6 billion, up 22 percent ignoring foreign exchange.

Cloud infrastructure brought in $2.2 billion in revenue, up 46 percent year over year. Cloud applications brought in $3.5 billion in revenue, up 10 percent year over year.

Cloud services revenue grew 22 percent year over year ignoring foreign exchange to $5.6 billion. Cloud license and on-premises license revenue hit $870 million, up 8 percent year over year ignoring foreign exchange.

Fusion Cloud ERP revenue was $900 million, up 17 percent year over year ignoring foreign exchange. NetSuite Cloud ERP brought in the same amount, growth of 20 percent year over year.

App subscription and product support revenue was up 7 percent year over year to $4.8 billion. Back-office staff apps saw annualized revenue of $8.2 billion, up 18 percent year over year.

Infrastructure subscription and license support revenue was $5.8 billion, up 14 percent year over year, according to the vendor. Infrastructure cloud services revenue was up 46 percent—49 percent excluding legacy hosting services—reaching annualized revenue of $8.6 billion.

Oracle Cloud Infrastructure consumption revenue grew 56 percent year over year. Cloud database services were up 23 percent year over year, with annualized revenue of $2.1 billion.

Oracle spent $2.3 billion on capital expenditures in the quarter to meet demand. Catz said she expects 2025 fiscal year CapEx to double Fiscal Year 2024’s.

Catz said that data center demand is still exceeding data center supply, with Oracle leaning more on automation for setting up and laying down data centers to speed up the process.

“We made the decision, instead of picking up small pieces, to actually wait, in some cases, to pick up larger locations,” Catz said. “That is really playing out very, very well for us. But we are really moving and growing in so many places because it’s not only public cloud rollout, but it is also private clouds, which are in immense demand; national security regions, immense demand; and really, we are moving as fast as we can.”

The vendor said it expects second fiscal quarter total revenue to grow 7 percent to 9 percent ignoring foreign exchange.

Oracle’s stock traded at about $152 a share after market close Monday, up about 9 percent.