Oracle says AI will save it from the SaaSpocalypse, not bring it on
It’s a better interface, can speed installations, and drives IaaS sales too
Oracle's Co-CEO Mike Sicilia argued in Oracle's Q1 FY 2027 earnings call that AI will strengthen their applications business, not bring on the feared SaaSpocalypse. Sicilia stated, "The introduction of AI is an accelerator, not a replacement for packaged applications." He explained that AI allows employees to oversee automated tasks, rather than manually executing processes as the system expects.
SalesForce's Cloudforce has already integrated an AI interface into their CRM. Sicilia expressed confidence in the potential of this new paradigm, promising an "agentic AI accelerator" that will automate and orchestrate implementation at scale. Oracle's SaaS business continued to grow ten percent, even with a three percent decline in software revenue to $5.5 billion.
Cloud services saw a more impressive 60% year-over-year growth to $11.6 billion. The company's investments in datacenters and AI infrastructure have been fruitful, with GPU capacity renewing or reselling at a 20% premium in Q1. Oracle's co-CEO Clay Magouyrk affirmed that the demand for AI infrastructure remains strong, with customers willing to pay a premium for it.
However, he noted that some datacenter projects are progressing faster than others, making precise revenue predictions challenging. Despite this, Oracle reported 850 MW of new datacenter capacity and expects earnings per share to rise to $8.10 on $90 billion in revenue. Oracle's shares rose seven percent initially, reflecting investor optimism, though the stock has since declined 21% for the year.
Written by urgent.news from The Register Science's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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