Larry Ellison, Monica Seles and Bill Gates (back row) watch Spain during the quarterfinals of the BNP Paribas Open in Indian Wells, California on March 14, 2024 Carlos Alcaraz versus Germany’s Alexander Zverev in the quarterfinals.
Clive Brunskill | Getty Images
It’s been a great year for Larry Ellison.
Oracle’s The software company the co-founder founded in 1979 has experienced its biggest share price rise since 1999 and the dot-com boom, and he has a paper fortune of about $75 billion.
According to data, while the S&P 500 index rose 27% in 2024, Oracle’s stock price rose 63%, bringing Allison’s net worth to more than $217 billion. Forbesonly after Tesla CEO Musk and Amazon Founder Jeff Bezos ranks among the richest people in the world.
At 80, Ellison is a veteran of the technology industry, while his fellow billionaire founders are often decades younger. Yuan CEO Mark Zuckerberg is also half his age, and his net worth has soared to more than $200 billion.
But Allison found a fountain of youth both personally and professionally. After several divorces, Allison report Had a relationship with a 33-year-old woman this month. At a meeting with analysts in Las Vegas in September, Ellison was as engaged as ever, casually mentioning that the night before he and his son had been having dinner with his good friend Musk, who was elected Advisor to President Donald Trump (then a Republican). Tesla and his other ventures.
His big financial gain comes from Oracle, which entered the artificial intelligence boom with its cloud infrastructure technology and made its databases more accessible.
OpenAI, the creator of ChatGPT, said in June that it would use Oracle’s cloud infrastructure. Earlier this month, Oracle explain It also received support from Yuan.
Startups often choose market leaders Amazon Web services have also been attracting Oracle when it comes to choosing the cloud. Last year, video generation startup Genmo built a system to train artificial intelligence models NVIDIA Graphics processing units (GPUs) in Oracle Cloud, CEO Paras Jain said. Genmo now relies on Oracle Cloud to create videos based on prompts users enter on its website.
“Oracle makes products that are different from products that use GPU computing elsewhere,” Jain said. He said the company’s “bare metal” computers can sometimes produce better performance than those using server virtualization.
In its latest earnings report released earlier this month, Oracle’s results fell short of analysts’ expectations and its forecasts were weaker than Wall Street’s expectations. The stock had its worst day of 2024, falling nearly 7% and eating into this year’s gains.
Still, Allison is optimistic about the future.
“Oracle Cloud Infrastructure trains some of the world’s most important generative artificial intelligence models because we are faster and cheaper than other clouds,” Ellison said in the earnings report.
In the fiscal year that ends in May, Oracle expects revenue to grow about 10%, which would be its second strongest expansion year since 2011.
Jain said that when Genmo encounters challenges, he communicates with Oracle sales executives and engineers through Slack channels. He said the partnership resulted in better reliability and performance. He said Oracle is working with Genmo to ensure developers can launch the startup’s Mochi open-source video generator on Oracle’s cloud hardware with a single click.
“Oracle is also more price competitive than these large hyperscalers,” Jain said.
“That would be easy”
Three months before its December earnings report, Oracle gave an optimistic outlook for the next three years at an analyst event in Las Vegas. Executive Vice President Doug Kehring announced that the company’s revenue in fiscal 2026 will exceed $66 billion. It will exceed $104 billion in fiscal year 2029. most recent quarter.
After Kehring and CEO Safra Catz spoke, it was Ellison’s turn. The company’s chairman, technology chief and largest shareholder strutted onto the stage in a black sweater and jeans, waved to analysts, licked his lips, and sat down. Over the next 74 minutes, he answered questions from seven analysts.
“Did he say $104 billion?” Allison said of Kling’s prediction. Some in the crowd chuckled. “That would be easy. It’s kind of crazy.”
Oracle’s fiscal 2023 revenue is just under $50 billion.
The new target impressed Eric Lynch, managing director of Scharf Investments, which held $167 million worth of Oracle stock at the end of September.
“For a company that’s been in the single digits for a decade or so, that’s incredible,” Lynch told CNBC.
Oracle co-founder and chairman Larry Ellison delivered a keynote speech at Oracle OpenWorld in San Francisco, California on October 22, 2018.
Justin Sullivan | Getty Images
Oracle still lags far behind when it comes to cloud infrastructure. In 2023, Amazon controlled 39% of the market, followed by Microsoft with 23%, Google According to data from industry research firm Gartner, this ratio is 8.2%. Oracle only has 1.4% left.
But in the field of database software, Oracle is still a backbone. Gartner predicts that the company will account for 17% of the market share in database management systems by 2023.
The challenge for Allison is finding expansion opportunities.
Last year, he visited Microsoft headquarters in Redmond, Washington, to first announce a partnership that would allow organizations to use Oracle’s databases through Microsoft’s Azure cloud. Microsoft even has Oracle hardware installed in its data centers.
In June, Oracle launched Similar announcements with Google. Then, in September, Oracle finally partnered with Amazon, Introducing its database on AWS.
Oracle and Amazon have been at each other’s throats for years. AWS launched a database called Aurora in 2014 as Amazon worked to move away from Oracle. After CNBC reported on the effort, Ellison expressed doubts about Amazon’s ability to achieve its goals. But the project was successful.
In 2019, Amazon released blog post The title is “Migration Complete – Amazon Consumer Business Just Shuts Down Its Final Oracle Database.”
more friendly atmosphere
Ellison reviewed the history of the two companies during a September analyst meeting.
“I’ve gotten lovely comments about Amazon using Oracle, not using AWS, and so on,” he said. “It hurt some people’s feelings. I probably shouldn’t have said that.”
He said a friend at a major New York bank asked him to make sure the Oracle database was running on AWS.
“I said, ‘Great. This makes sense to me,'” Allison said.
The multi-cloud strategy should lead to database market share growth, said Siti Panigrahi, an analyst at Mizuho Bank, which has a buy rating on Oracle stock. He said cloud deals related to artificial intelligence would also help Oracle deliver on its promise of faster revenue growth.
“Oracle now has an end-to-end stack for enterprises to develop their AI strategies,” said Panigrahi, who worked on applications at Oracle in the 2000s.
So far, Oracle has mainly struck high-value artificial intelligence deals with companies such as OpenAI and Musk’s X.ai. Of Oracle’s $97 billion in remaining performance obligations or unrecognized revenue, 40% or 50% is related to leasing GPUs, Panigrahi said.
Oracle did not respond to a request for comment.
Panigrahi predicts that more businesses will start adopting artificial intelligence, which would be a boon considering Oracle has hundreds of thousands of large customers.
There is also hope from Oracle Health, a unit that is the result of the company’s $28.2 billion acquisition of electronic health records software provider Cerner in 2022.
Yoshiki Hayashi, Marc Benioff and Larry Ellison attend the USC Transformative Medicine: Rebels with a Cause Gala on October 24, 2019 in Santa Monica, California.
Joshua Blanchard | Getty Images
Oracle Health is estimated to lose U.S. market share in 2023, unlike rival Epic Klass Research. But Evercore analysts said in a report last week that Ellison’s relationship with Musk could benefit Oracle Health “if there is an increased effort to modernize the existing health care system” and Musk will co-lead Trump. General Department of Government Effectiveness. They recommend buying the stock.
Ellison said at the analyst event that Oracle is currently busy rewriting Cerner’s entire code base using artificial intelligence.
“This is another pillar of growth,” he said. “I think you haven’t seen it clearly yet.”
A few hours earlier, Ellison had called Marc Benioff, the company’s co-founder and chief executive. salesperson. Benioff knows Ellison as well as anyone, having worked for the company for 13 years before starting the cloud software company that is now part of the company. Big competitor.
“It was awesome,” Benioff said of his conversation with Allison in a wide-ranging interview the next day.
Benioff discussed his former boss’s recent fortune.
“Larry really, really wanted this,” Benioff said. “It’s very important to him, he’s building a great company, he thinks it’s one of the most important companies in the world, and wealth is very important to him.”
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