The Numbers Don't Lie: Oracle Has Its Head in the Cloud

Oracle announced a $9.3 billion acquisition of NetSuite to expand its market share in the rapidly growing public cloud market, which is expected to reach $140 billion by 2019. Competing with Salesforce, Microsoft, and SAP, Oracle's deal is one of the most expensive software takeovers, with a revenue multiple of 11. As Oracle shifts to cloud services, it experiences a decline in upfront license fees but an increase in subscription revenue. This transition leads to volatile financial results, which Oracle's Chairman Larry Ellison has tried to stabilize through acquisitions. Oracle's earnings are set to be released after the US closing bell.

What was the primary reason behind Oracle's acquisition of NetSuite?

• To enter the hardware market

• To reduce operational costs

• To gain market share in the cloud market

• To diversify its product offerings

Which companies are Oracle's main competitors in the cloud market?

• Salesforce, Microsoft, and SAP

• IBM and Google

• Amazon and Facebook

• Apple and Intel

What is a notable trend in recent acquisitions by Oracle, Salesforce, and SAP?

• Low revenue multiples

• High revenue multiples near 11

• Reduction in acquisition activities

• Focus on hardware acquisitions

How has Oracle's transition to cloud services affected its revenue?

• Decline in cloud software revenue

• Stable revenue across all services

• Significant growth in cloud software revenue

• Increased revenue from software licenses

What challenge does Oracle face as it shifts to cloud services?

• Volatile financial results

• Increased competition from new entrants

• Regulatory hurdles

• Decline in customer satisfaction