Executive Summary
Oracle reported QQ1 2025 revenue of $13.307 billion, up 6.86% year-over-year (YoY) and down 6.86% quarter-over-quarter (QoQ). The gross margin remained robust at approximately 70.65%, with an operating margin near 30.0% and a net margin around 22.0%. Diluted EPS was $1.03 and GAAP EPS was $1.06, reflecting a disciplined cost structure and strong profitability during a transition to higher cloud mix. Free cash flow (FCF) reached $5.12 billion, supported by operating cash flow of $7.43 billion and capital expenditures of $2.30 billion, underscoring Oracle’s capacity to generate cash while funding share repurchases and dividends. The company ended the period with $10.62 billion in cash and equivalents and a total liquidity position that, combined with $7.39 billion of net debt, indicates substantial balance-sheet strength but a high absolute leverage level driven by long-term debt and goodwill.
Management’s framework centers on accelerating Oracle Cloud Infrastructure (OCI) adoption, expanding Fusion Cloud (ERP, HCM, SCM), and leveraging NetSuite to cross-sell across an expansive customer base. While management did not provide explicit numeric forward guidance in the QQ1 call data available here, the sustained cash flow generation and margin resilience suggest a positive underlying trajectory as Oracle continues to monetize cloud-native offerings and AI-enabled capabilities. Near-term volatility is plausible given seasonality and enterprise IT budgeting cycles, but the longer-term thesis remains: cloud-first revenue growth with durable margins if the cloud transition sustains.
Key Performance Indicators
QoQ: -18.20% | YoY:15.98%
Key Insights
Revenue: $13.307B; YoY +6.86%; QoQ -6.86%
Gross Profit: $9.401B; Gross Margin 70.65%; YoY +6.31%; QoQ -2.29%
Operating Income: $3.991B; Operating Margin 29.99%; YoY +15.98%; QoQ -18.20%
Net Income: $2.929B; Net Margin 22.01%; YoY +21.03%; QoQ -6.84%
EPS (GAAP): $1.06; EPS (Diluted): $1.03; YoY EPS +19.10%; QoQ -7.02%
EBITDA: $5.482B; EBITDA Margin ~41.20%
Free Cash Flow: $5.124B; Operating Cash Flow: $7.427B; Capital Expenditures: $2.303B; FCF per share: $1.86
Cash and cash equivalents: $10.616B...
Financial Highlights
Revenue: $13.307B; YoY +6.86%; QoQ -6.86%
Gross Profit: $9.401B; Gross Margin 70.65%; YoY +6.31%; QoQ -2.29%
Operating Income: $3.991B; Operating Margin 29.99%; YoY +15.98%; QoQ -18.20%
Net Income: $2.929B; Net Margin 22.01%; YoY +21.03%; QoQ -6.84%
EPS (GAAP): $1.06; EPS (Diluted): $1.03; YoY EPS +19.10%; QoQ -7.02%
EBITDA: $5.482B; EBITDA Margin ~41.20%
Free Cash Flow: $5.124B; Operating Cash Flow: $7.427B; Capital Expenditures: $2.303B; FCF per share: $1.86
Cash and cash equivalents: $10.616B; Total cash & short-term investments: $10.911B
Total debt: $84.515B; Long-term debt: $75.314B; Short-term debt: $9.201B; Net debt: $73.899B
Total assets: $144.214B; Total liabilities: $132.945B; Total stockholders’ equity: $10.816B
Liquidity ratios (current/quick): ~0.72x; Gross margin: ~70.65%; Net margin: ~22.01%
Return on equity (ROE): ~27.1%; Debt to equity: ~7.81; Free cash flow yield and other valuations indicate a premium multiple (P/E ~33.3x; P/FCF ~76x).
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
13.31B |
6.86% |
-6.86% |
| Gross Profit |
9.40B |
6.31% |
-2.29% |
| Operating Income |
3.99B |
15.98% |
-18.20% |
| Net Income |
2.93B |
21.03% |
-6.84% |
| EPS |
1.06 |
19.10% |
-7.02% |
Key Financial Ratios
operatingProfitMargin
30%
operatingCashFlowPerShare
$2.69
freeCashFlowPerShare
$1.86
dividendPayoutRatio
37.7%
Management Commentary
No earnings call transcript was provided in the data set. Therefore, there are no management quotes or theme summaries available to annotate within this section.
Forward Guidance
Oracle did not publish explicit numeric guidance for QQ2 2025 in the provided data. Given the context of the technology software sector and Oracle’s stated strategic emphasis on growing OCI and expanding Fusion Cloud and NetSuite penetration, the near-term outlook hinges on: 1) the rate of cloud revenue take-up and OCI monetization, 2) mix-shift from on-prem/license to cloud-based offerings, and 3) continued margin discipline amid investment in cloud capability and AI features. investors should monitor: cloud revenue growth rates (OCI adoption), cadence of Fusion Cloud ERP/HCM/SCM deployments, NetSuite cross-sell momentum, operating margins (especially as OCI scale increases), and free cash flow generation after sustaining capex. The key risks to watch include a slower-than-expected transition to cloud, competitive intensity from hyperscalers and peer ERP providers, and any exacerbation of macro or IT budgetary constraints that could impact enterprise software spend.