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What changed in Oracle Corporation's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Oracle Corporation's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+373 added−411 removedSource: 10-K (2024-06-20) vs 10-K (2023-06-20)

Top changes in Oracle Corporation's 2024 10-K

373 paragraphs added · 411 removed · 312 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

85 edited+6 added−12 removed89 unchanged
Biggest changeOracle Autonomous Database Oracle Autonomous Database is designed to deliver performance and scale for enterprise database workloads with automated database operations and policy- and machine learning-driven optimization by combining certain Oracle infrastructure technologies, including the Oracle Database, Oracle’s Next-Generation Cloud Infrastructure, Oracle Exadata, and native machine learning capabilities, among others.
Biggest changeThis capability now also allows us to offer sovereign AI to customers who want the latest in AI innovations while operating within their regulatory environments; • Oracle Alloy, which is engineered to enable partners to control the commercial and customer experience to address their specific market needs for cloud services; and • Oracle Roving Edge Infrastructure, which is designed to enable customers to access cloud computing and storage services at the edge of networks and in generally disconnected locations in order to accelerate deployment of cloud workloads outside of the data center. 9 Table of Contents Index to Financial Statements Oracle Autonomous Database Oracle Autonomous Database is designed to deliver performance and scale for enterprise database workloads with automated database operations and policy- and machine learning-driven optimization by combining certain Oracle infrastructure technologies, including the Oracle Database, OCI, Oracle Exadata, and native machine learning capabilities, among others.
We believe Oracle Fusion Cloud ERP is a strategic suite of applications that is foundational to facilitating and extracting more business value out of the adoption of other Oracle SaaS offerings, such as Oracle Fusion Cloud HCM and Oracle Fusion Cloud EPM, as customers realize the value of a common data model that spans across core business applications.
We believe Oracle Fusion Cloud ERP is a strategic suite of applications that is foundational to facilitating and extracting more business value out of the adoption of other Oracle Cloud SaaS offerings, such as Oracle Fusion Cloud HCM and Oracle Fusion Cloud EPM, as customers realize the value of a common data model that spans across core business applications.
Oracle Database is licensed throughout the world by businesses and organizations of all sizes for a multitude of purposes, including, among others: for use within the Oracle Cloud to deliver our Oracle SaaS and OCI offerings; for use as a cloud license by a number of cloud-based vendors as a component of their respective cloud offerings; for packaged and custom applications for transaction processing; and for data warehousing and business intelligence.
Oracle Database is licensed throughout the world by businesses and organizations of all sizes for a multitude of purposes, including, among others, for use within the Oracle Cloud to deliver our SaaS and OCI offerings; for use as a cloud license by a number of cloud-based vendors as a component of their respective cloud offerings; for packaged and custom applications for transaction processing; and for data warehousing and business intelligence.
Our enterprise cloud, license and hardware offerings compete directly with certain offerings from some of the largest and most competitive companies in the world, including Amazon.com, Inc., Microsoft Corporation, International Business Machines Corporation, Intel Corporation, Cisco Systems, Inc., Adobe Systems Incorporated, Alphabet Inc., Salesforce, Inc. and SAP SE, as well as other companies like Hewlett-Packard Enterprise and Workday, Inc.
Our enterprise cloud, license and hardware offerings compete directly with certain offerings from some of the largest and most competitive companies in the world, including Adobe Systems Incorporated, Alphabet Inc., Amazon.com, Inc., Cisco Systems, Inc., Intel Corporation, International Business Machines Corporation, Microsoft Corporation, Salesforce, Inc. and SAP SE, as well as other companies like Hewlett-Packard Enterprise and Workday, Inc.
For example, following our acquisition of Cerner, we also face competition from large healthcare IT providers such as Epic Systems Corporation, Allscripts Healthcare Solutions, Inc., Arcadia Solutions, athenahealth, Inc. and InterSystems Corporation, among others.
For example, following our acquisition of Cerner Corporation (Cerner), we also face competition from large healthcare IT providers such as Allscripts Healthcare Solutions, Inc., Arcadia Solutions, athenahealth, Inc., Epic Systems Corporation and InterSystems Corporation, among others.
Our products and services sales and the relative strength of our products and services versus those of our competitors are also directly and indirectly affected by the following, among other factors: • market adoption of cloud-based IT offerings, including SaaS and cloud infrastructure offerings; • the ease of deployment, use, transacting for and maintenance of our products and services offerings; • compatibility between Oracle products and services deployed within local IT environments and public cloud IT environments, including our Oracle Cloud environments; • the adoption of commodity servers and microprocessors; • the broader “platform” competition between our industry standard Java technology platform and the .NET programming environment of Microsoft; • operating system competition among our Oracle Solaris and Linux operating systems, with alternatives including Microsoft’s Windows Server and other UNIX and Linux operating systems; • the adoption of open source alternatives to commercial software by enterprise software customers; • products, features and functionality developed internally by customers and their IT staff; 15 Table of Contents Index to Financial Statements • products, features and functionality customized and implemented for customers by consultants, systems integrators or other third parties; and • the attractiveness of offerings from business processing outsourcers.
Our products and services sales and the relative strength of our products and services versus those of our competitors are also directly and indirectly affected by the following, among other factors: 16 Table of Contents Index to Financial Statements • market adoption of cloud-based IT offerings, including SaaS and cloud infrastructure offerings; • the ease of deployment, use, transacting for and maintenance of our products and services offerings; • compatibility between Oracle products and services deployed within local IT environments and public cloud IT environments, including our Oracle Cloud environments; • the adoption of commodity servers and microprocessors; • the broader “platform” competition between our industry standard Java technology platform and the .NET programming environment of Microsoft; • operating system competition among our Oracle Solaris and Linux operating systems, with alternatives including Microsoft’s Windows Server and other UNIX and Linux operating systems; • the adoption of open source alternatives to commercial software by enterprise software customers; • products, features and functionality developed internally by customers and their IT staff; • products, features and functionality customized and implemented for customers by consultants, systems integrators or other third parties; and • the attractiveness of offerings from business processing outsourcers.
Accordingly, we offer choice and flexibility to our customers and facilitate the product, service and deployment combinations that best suit our customers’ needs. Our customers include businesses of many sizes, government agencies, educational institutions and resellers that we market and sell to directly through our worldwide sales force and indirectly through the Oracle Partner Network.
Accordingly, we offer choice and flexibility to our customers and facilitate the product, service and deployment combinations that best suit our customers’ needs. Our customers include businesses of many sizes, government agencies, educational institutions and resellers that we market and sell to directly through our worldwide sales force or indirectly through the Oracle Partner Network.
Oracle is committed to being at the forefront of positive social impact through initiatives focused on education, the environment and community. Our philanthropic education initiatives, Oracle Academy and the Oracle Education Foundation, help students develop the skills they need to become technology innovators and leaders.
Oracle is committed to being at the forefront of positive social impact through initiatives focused on education, the environment, community and health. Our philanthropic education initiatives, Oracle Academy and the Oracle Education Foundation, help students develop the skills they need to become technology innovators and leaders.
For example, Oracle Exadata Database Machine is an integrated platform that is optimized for running Oracle Database, achieving higher performance, scalability and availability at a lower cost by combining Oracle Database, storage and operating system software with Oracle server, storage and networking hardware.
For example, Oracle Exadata Database Machine is an integrated platform that is optimized for achieving higher performance, scalability and availability at a lower cost by combining Oracle Database, storage and operating system software with Oracle server, storage and networking hardware.
Our SaaS offerings are also designed to natively incorporate advanced technologies such as Internet-of-Things (IoT), artificial intelligence (AI), machine learning, blockchain, digital assistants and advances in the “human interface” and how users interact with Oracle Cloud SaaS offerings within a business context or to augment human capabilities to enhance productivity.
Our SaaS offerings are also designed to natively incorporate advanced technologies such as AI, Internet-of-Things (IoT), machine learning, blockchain, digital assistants and advances in the “human interface” and how users interact with Oracle Cloud SaaS offerings within a business context or to augment human capabilities to enhance productivity.
We share the results of our annual employee engagement survey with leaders who receive direct observations from employees about areas critical to Oracle’s strategic priorities, including the employee and customer experience. The results of the survey are also discussed with our Board of Directors and committees thereof. In fiscal 2023, 81% of our employees participated in the annual survey.
We share the results of our annual employee engagement survey with leaders who receive direct observations from employees about areas critical to Oracle’s strategic priorities, including the employee and customer experience. The results of the survey are also discussed with our Board of Directors and committees thereof. In fiscal 2024, 81% of our employees participated in the annual survey.
In recent periods, customer demand for our applications and infrastructure technologies delivered through our Oracle Cloud Services deployment models has increased.
In recent periods, customer demand for our applications and infrastructure technologies delivered through our Oracle Cloud deployment models has increased.
To address customer demand and enable customer choice, 4 Table of Contents Index to Financial Statements we have introduced certain programs for customers to pivot their applications and infrastructure licenses and license support contracts to the Oracle Cloud for new deployments and to migrate to and expand with the Oracle Cloud for their existing workloads.
To address customer demand and enable customer choice, we have 5 Table of Contents Index to Financial Statements introduced certain programs for customers to pivot their applications and infrastructure licenses and license support contracts to the Oracle Cloud for new deployments and to migrate to and expand with the Oracle Cloud for their existing workloads.
Oracle Engineered Systems are designed to work together to deliver improved performance, scalability, availability, security and operational efficiency relative to our competitors’ products; to be upgraded effectively and efficiently in a non-disruptive manner; and to simplify maintenance cycles and improve security by providing a single solution for patching.
Oracle Engineered Systems are designed to deliver improved performance, scalability, availability, security and operational efficiency relative to our competitors’ products; to be upgraded effectively and efficiently in a non-disruptive manner; and to simplify maintenance cycles and improve security by providing a single solution for patching.
Catz Chief Executive Officer and Director Jeffrey O. Henley Vice Chairman of the Board of Directors Edward Screven Executive Vice President, Chief Corporate Architect Stuart Levey Executive Vice President, Chief Legal Officer Maria Smith Executive Vice President, Chief Accounting Officer Mr. Ellison, 78, has been our Chairman of the Board and Chief Technology Officer since September 2014.
Catz Chief Executive Officer and Director Jeffrey O. Henley Vice Chairman of the Board of Directors Edward Screven Executive Vice President, Chief Corporate Architect Stuart Levey Executive Vice President, Chief Legal Officer Maria Smith Executive Vice President, Chief Accounting Officer Mr. Ellison, 79, has been our Chairman of the Board of Directors and Chief Technology Officer since September 2014.
We also offer industry-specific applications, which provide solutions to customers in the automotive, communications, construction and engineering, consumer goods, energy and water, financial services, food and beverage, government and education, healthcare, high technology, hospitality, industrial manufacturing, life sciences, media and entertainment, oil and gas, professional services, retail, travel and transportation and wholesale distribution industries, among others.
We also offer industry-specific applications, which provide solutions to customers in the automotive, communications, construction and engineering, consumer packaged goods, energy and water, financial services, food and beverage, government and education, healthcare, high technology, hospitality, industrial manufacturing, life sciences, media and entertainment, oil and gas, professional services, public safety, retail, travel and transportation and wholesale distribution industries, among others.
Item 1. Business Oracle provides products and services that address enterprise information technology (IT) environments. Our products and services include enterprise applications and infrastructure offerings that are delivered worldwide through a variety of flexible and interoperable IT deployment models.
Item 1. Business Oracle provides products and services that address enterprise information technology (IT) needs. Our products and services include enterprise applications and infrastructure offerings that are delivered worldwide through a variety of flexible and interoperable IT deployment models.
Catz, 61, has been our Chief Executive Officer since September 2014. She served as our President from January 2004 to September 2014, our Chief Financial Officer most recently from April 2011 until September 2014 and a Director since October 2001.
Catz, 62, has been our Chief Executive Officer since September 2014. She served as our President from January 2004 to September 2014, our Chief Financial Officer most recently from April 2011 until September 2014 and a Director since October 2001.
For example, the Oracle Autonomous Database is designed to deliver transformational infrastructure as an OCI offering that uses machine learning capabilities to automate many traditionally manual functions.
For example, our Oracle Autonomous Database is designed to deliver transformational infrastructure as an OCI offering that uses machine learning capabilities to automate many traditionally manual functions.
Oracle Engineered Systems are pre-integrated products, combining multiple unique Oracle technology components, including database, storage, operating system and management software with server, storage, networking hardware and other technologies.
Oracle Engineered Systems are pre-built products, combining multiple unique Oracle technology components, including database, storage, operating system and management software with server, storage, networking hardware and other technologies.
All of which is designed to enable organizations to gain new insights into customer behavior, more accurately anticipate future demand, align workforce deployment with business activity forecasts and accelerate the pace of operations, among other benefits. For transaction processing workloads, Oracle Autonomous Database is designed to enable organizations to safely run a mix of high-performance transactions of ranging complexity.
All of these capabilities are designed to enable organizations to gain new insights into customer behavior, more accurately anticipate future demand, align workforce deployment with business activity forecasts and accelerate the pace of operations, among other benefits. For transaction processing workloads, Oracle Autonomous Database is designed to enable organizations to safely run a mix of high-performance transactions of ranging complexity.
We use our Investor Relations website as a means of disclosing material non-public information. Accordingly, investors should monitor our Investor Relations website, in addition to following our press releases, SEC filings and public conference calls and webcasts. In addition, information regarding our environmental policy and global sustainability initiatives and solutions are also available on our website at www.oracle.com/corporate/citizenship.
We use our Investor Relations website as a means of disclosing material non-public information. Accordingly, investors should monitor our Investor Relations website, in addition to following our press releases, SEC filings and public conference calls and webcasts. In addition, information regarding our environmental policy and global sustainability initiatives and solutions are also available on our website at www.oracle.com/social-impact.
We strive to enable our employees to further their careers, build their networks and foster the skills needed to succeed at Oracle, including through participation in our Employee Resource Groups, which offer employees opportunities to engage in mentor relationships and further develop diverse leaders and employees at Oracle.
We strive to enable our employees to further their careers, build their networks and foster the skills needed to succeed at Oracle, including through participation in our Employee Resource Groups, which offer employees opportunities to engage in mentor relationships that further develop inclusive leaders and employees at Oracle.
Our Talent Review process, which runs on Oracle Fusion Cloud HCM, provides the mechanism for leaders to review and discuss opportunities and action plans to develop employees. 29% of our open non-entry level positions were filled internally in fiscal 2023, providing growth opportunities and retaining critical knowledge and talent.
Our Talent Review process, which runs on Oracle Fusion Cloud HCM, provides the mechanism for leaders to review and discuss opportunities and action plans to develop employees. 32% of our open non-entry level positions were filled internally in fiscal 2024, providing growth opportunities and retaining critical knowledge and talent.
Our infrastructure cloud services and license support revenues represented 53%, 58% and 59% of our total cloud services and license support revenues during fiscal 2023, 2022 and 2021, respectively. Oracle Cloud Infrastructure (OCI) OCI offerings are based upon Oracle’s Next-Generation Cloud Infrastructure and are designed to deliver our infrastructure technologies, including compute, storage and networking services, as a service.
Our infrastructure cloud services and license support revenues represented 54%, 53% and 58% of our total cloud services and license support revenues during fiscal 2024, 2023 and 2022, respectively. Oracle Cloud Infrastructure (OCI) OCI offerings are based upon Oracle’s Next-Generation Cloud Infrastructure and are designed to deliver our infrastructure technologies, including compute, storage and networking services, as a service.
The proportion of our cloud services revenues relative to our total revenues has increased and our cloud services revenues represented 32%, 25% and 22% of our total revenues during fiscal 2023, 2022 and 2021, respectively. We expect these trends to continue. Oracle Applications Technologies Oracle applications technologies are marketed, sold, delivered and supported through our cloud and license business.
The proportion of our cloud services revenues relative to our total revenues has increased and our cloud services revenues represented 37%, 32% and 25% of our total revenues during fiscal 2024, 2023 and 2022, respectively. We expect these trends to continue. Oracle Applications Technologies Oracle applications technologies are marketed, sold, delivered and supported through our cloud and license business.
She was previously our Chief Financial Officer from November 2005 until September 2008 and our Interim Chief Financial Officer from April 2005 until July 2005. Prior to being named our President, she held various other positions with us since joining Oracle in 1999. She currently serves as a director of The Walt Disney Company. She also serves on the U.S.
She was previously our Chief Financial Officer from November 2005 until September 2008 and our Interim Chief Financial Officer from April 2005 until July 2005. Prior to being named our President, she held various other positions with us since joining Oracle in 1999. She currently serves as a director of The Walt Disney Company. Mr.
We believe our SaaS offerings remove business boundaries between front- and back-office activities. Our SaaS offerings are designed to deliver a secure data isolation architecture and flexible upgrades; self-service access controls for users; a Service-Oriented Architecture; built-in social, mobile and business insight capabilities (analytics); and a high performance, high availability infrastructure based on Oracle’s Next-Generation Cloud Infrastructure.
We believe our SaaS offerings together remove business boundaries between front- and back-office activities. Our SaaS offerings are designed to deliver a secure data isolation architecture and flexible upgrades; self-service access controls for users; a Service-Oriented Architecture; built-in social, mobile and business insight capabilities (analytics); and a high performance, high availability infrastructure based on OCI.
We plan to continue to dedicate a significant amount of resources to research and development efforts to maintain and improve our current products and services offerings. 12 Table of Contents Index to Financial Statements Human Capital Resources At Oracle, our success is driven by the quality of our people, who we believe are among the best and brightest in the industry.
We plan to continue to dedicate a significant amount of resources to research and development efforts to maintain and improve our current products and services offerings. Human Capital Resources At Oracle, our success is driven by the quality of our people, who we believe are among the best and brightest in the industry.
We seek to continuously build on our inclusive hiring strategies, tracking our progress and holding ourselves accountable for greater diversity at Oracle.
We seek to continuously build on our inclusive hiring strategies, tracking our progress and holding ourselves accountable for greater diverse representation at Oracle.
In fiscal 2023, 2022 and 2021, we invested $8.6 billion, $7.2 billion and $6.5 billion, respectively, in research and development to enhance our existing portfolio of offerings and to develop new technologies and services.
In fiscal 2024, 2023 and 2022, we invested $8.9 billion, $8.6 billion and $7.2 billion, respectively, in research and development to enhance our existing portfolio of offerings and to develop new technologies and services.
Our Board of Directors oversees diversity and inclusion (D&I) matters and the Compensation Committee of our Board of Directors is responsible for reviewing and monitoring matters related to human capital management, including talent acquisition and retention.
Our Board of Directors oversees culture and inclusion (C&I) matters and the Compensation Committee of our Board of Directors (the Compensation Committee) is responsible for reviewing and monitoring matters related to human capital management, including talent acquisition and retention.
We are proud to be recognized for our ongoing progress and commitment to D&I.
We are proud to be recognized for our ongoing progress and commitment to C&I.
Oracle Cloud Services integrate the IT components, including software, hardware and services, on a customer’s behalf in a cloud-based IT environment that Oracle deploys, manages, supports and upgrades for the customer and that a customer may access utilizing common web browsers via a broad spectrum of devices.
Oracle Cloud Services integrate the IT components, including software, hardware and services, in a cloud-based IT environment that Oracle deploys, manages, supports and upgrades for customers and that customers may access utilizing common web browsers via a broad spectrum of devices.
Leaders listen to employees, evaluate feedback and prioritize actions to enhance employee, business and customer success. Making a Difference Each year, through our volunteering and giving programs, Oracle employees donate tens of thousands of volunteer hours and millions of dollars (matched by Oracle) to a wide variety of causes.
Leaders listen to employees, evaluate feedback and prioritize actions to enhance employee, business and customer success. 15 Table of Contents Index to Financial Statements Making a Difference Each year, through our volunteering and giving programs, Oracle employees donate tens of thousands of volunteer hours and millions of dollars (matched by Oracle) to a wide variety of causes.
Our hardware business’ infrastructure technologies consist of hardware products and certain unique hardware-related software offerings and include Oracle Engineered Systems, enterprise servers, storage solutions, industry-specific hardware, virtualization software, operating systems, management software and related hardware services, including hardware support at the customer’s option.
Our hardware business’ infrastructure technologies consist of hardware products and certain unique hardware-related software offerings, including Oracle Engineered Systems, enterprise servers, storage solutions, industry-specific hardware, virtualization software, operating systems, management software and related hardware support services.
Substantially all license support customers renew their support contracts with us upon expiration in order to continue to benefit from technical support services and the periodic issuance of unspecified updates and 6 Table of Contents Index to Financial Statements enhancements, which current license support customers are entitled to receive.
Substantially all license support customers renew their support contracts with us upon expiration in order to continue to benefit from technical support services and the periodic issuance of unspecified updates and enhancements, which current license support customers are entitled to receive.
Oracle SaaS and OCI (collectively Oracle Cloud Services) offerings provide comprehensive and integrated applications and infrastructure services delivered via various cloud delivery models enabling our customers to choose the best option that meets their specific business needs.
Oracle SaaS and OCI (collectively Oracle Cloud Services) offerings provide comprehensive and integrated applications and infrastructure services enabling our customers to choose the best option that meets their specific business needs.
Customers use OCI to build and operate new applications ranging from low-code to AI powered cloud-native applications, to run new workloads and to move their existing Oracle or non-Oracle workloads to the Oracle Cloud from their on-premise data centers or other cloud-based IT environments, among other uses.
Customers use OCI to build and operate new applications ranging from low-code to AI powered cloud-native 8 Table of Contents Index to Financial Statements applications, to run new workloads and to move their existing Oracle or non-Oracle workloads to the Oracle Cloud from their on-premise data centers or other cloud-based IT environments, among other uses.
Our SaaS offerings represent an industry leading business innovation platform, leveraging Oracle’s Next-Generation Cloud Infrastructure, and include a broad suite of modular, next-generation cloud software applications spanning all core business functions, including, among others: • Oracle Fusion Cloud Enterprise Resource Planning (ERP), which is designed to be a complete, global and integrated ERP solution to help organizations improve decision making and workforce productivity, and to optimize back-office operations by utilizing a single data and security model with a common user interface; • Oracle Fusion Cloud Enterprise Performance Management (EPM), which is designed to analyze financial performance, drive accurate and agile financial plans, optimize the financial close and consolidation process, streamline account reconciliation and satisfy an organization’s reporting requirements; • Oracle Fusion Cloud Supply Chain and Manufacturing Management (SCM), which is designed to help organizations create, optimize and digitize their supply chains and innovate products quickly; • Oracle Fusion Cloud Human Capital Management (HCM), which is designed to help organizations find, develop and retain their talent, enable collaboration, provide complete workforce insights, improve business process efficiency and enable users to connect to an integrated suite of HCM applications from any device; • Oracle Fusion Sales, Service and Marketing, which are modules that are designed to be complete and integrated solutions to help organizations deliver consistent and personalized customer experiences across their customer channels, touch points and interactions; 5 Table of Contents Index to Financial Statements • NetSuite Applications Suite, which is designed to be a unified, cloud-based applications suite to run a company’s entire business and includes financials and ERP, customer relationship management, human resources, professional services and commerce, among others.
Our SaaS offerings represent an industry leading business innovation platform leveraging OCI and include a broad suite of modular, next-generation cloud software applications spanning all core business functions, including, among others: • Oracle Fusion Cloud ERP, which is designed to be a complete and integrated ERP solution to help organizations improve decision making and workforce productivity, and to optimize back-office operations by utilizing a single data and security model with a common user interface; • Oracle Fusion Cloud Enterprise Performance Management (EPM), which is designed to analyze financial performance, drive accurate and agile financial plans, optimize the financial close and consolidation process, streamline account reconciliation and satisfy an organization’s reporting requirements; • Oracle Fusion Cloud Supply Chain and Manufacturing Management (SCM), which is designed to help organizations create, optimize and digitize their supply chains; • Oracle Fusion Cloud Human Capital Management (HCM), which is designed to help organizations find, develop and retain their talent, enable collaboration, provide workforce insights, improve business process efficiency and enable users to connect to an integrated suite of HCM applications from a broad range of devices; • Oracle Fusion Sales, Service and Marketing, which are modules that are designed to be complete and integrated solutions to help organizations deliver consistent and personalized customer experiences across their customer channels, touch points and interactions; 6 Table of Contents Index to Financial Statements • NetSuite Applications Suite, which is generally marketed to small to medium-sized organizations and is designed to be a unified, cloud-based applications suite to run a company’s entire business and includes financials and ERP, customer relationship management, human resources, professional services and commerce, among others; and • Oracle Cerner healthcare applications, which are designed to enable medical professionals to deliver better healthcare to individual patients and communities.
Internal development allows us to maintain technical control over the design and development of our products. We have a number of U.S. and foreign patents and pending applications that relate to various aspects of our products and technology.
Internal development allows us to maintain technical control over the design and 13 Table of Contents Index to Financial Statements development of our products. We have a number of U.S. and foreign patents and pending applications that relate to various aspects of our products and technology.
Homeland Security Advisory Council. Mr. Henley, 78, has served as our Vice Chairman of the Board since September 2014. He previously served as our Chairman of the Board from January 2004 to September 2014 and has served as a Director since June 1995. He served as our Executive Vice President and Chief Financial Officer from March 1991 to July 2004.
Henley, 79, has served as our Vice Chairman of the Board of Directors since September 2014. He previously served as our Chairman of the Board of Directors from January 2004 to September 2014 and has served as a Director since June 1995. He served as our Executive Vice President and Chief Financial Officer from March 1991 to July 2004. Mr.
We focus our development efforts 3 Table of Contents Index to Financial Statements on improving the performance, security, reliability, operation, integration and cost-effectiveness of our offerings relative to our competitors; facilitating the ease with which organizations are able to deploy, use, manage and maintain our offerings; and incorporating emerging technologies within our offerings to enable leaner business processes, automation and innovation.
We focus our development efforts on improving the performance, security, reliability, operation, integration and cost-effectiveness of our offerings relative to our competitors; facilitating the ease with which organizations are able to deploy, use, manage and maintain our offerings; and incorporating emerging technologies such as AI within our offerings to enable leaner business processes, automation and innovation.
OCI AI services are designed to be embedded into customer applications for a variety of predictive use cases, including, among others, the servicing of machine parts that are at risk of failing, the stocking of retailer store shelves, credit fraud detection and the financial modeling to stay within a business’ forecasts.
OCI AI offerings are designed to be embedded into customer applications for a variety of predictive use cases, including, among others, the servicing of machine parts that are at risk of failing, using generative AI for fault detection on an assembly line, the stocking of retailer store shelves, credit fraud detection and financial modeling to stay within a business’ forecasts.
Our approximate employee counts by lines of business are: 27,000 Cloud services and license support operations 39,000 Services 35,000 Sales and marketing 47,000 Research and development 3,000 Hardware 13,000 General and administrative The average tenure of our employees is approximately eight years and 27% of our employees have been employed with Oracle for ten or more years.
Our approximate employee counts by lines of business are: 28,000 Cloud services and license support operations 37,000 Services 32,000 Sales and marketing 47,000 Research and development 3,000 Hardware 12,000 General and administrative The average tenure of our employees is approximately eight years and 29% of our employees have been employed with Oracle for ten or more years.
Our applications cloud services and license support revenues represented 47%, 42% and 41% of our total cloud services and license support revenues during fiscal 2023, 2022 and 2021, respectively.
Our applications cloud services and license support revenues represented 46%, 47% and 42% of our total cloud services and license support revenues during fiscal 2024, 2023 and 2022, respectively.
We have a deep understanding as to how applications and infrastructure technologies interact and function with one another, including through the use of OCI to power our Oracle Fusion SaaS Applications, which we and our customers use to run internal business processes.
We have a deep understanding as to how applications and infrastructure technologies 4 Table of Contents Index to Financial Statements interact and function with one another, including through the use of OCI to power our Oracle Cloud SaaS applications, which we and our customers use to run internal business processes.
Our infrastructure technologies are designed to be flexible, cost-effective, standards-based, secure and highly-performant to facilitate the development, deployment, integration, management and extension across an organization’s cloud-based, on-premise and hybrid IT environments.
Oracle Infrastructure Technologies Oracle infrastructure technologies are marketed, sold and delivered through our cloud and license business and through our hardware business. Our infrastructure technologies are designed to be flexible, cost-effective, standards-based, secure and highly-performant to facilitate the development, deployment, integration, management and extension across an organization’s cloud-based, on-premise and hybrid IT environments.
In addition to global, regional and local programs, Oracle Human Resources partners with business leaders to create and implement D&I plans to embed targeted strategies into organizations across Oracle. Employee satisfaction on the importance of D&I at Oracle and their manager’s encouragement of diverse ideas and perspectives ranks high in our employee engagement surveys.
In addition to global, regional and local programs, Oracle Human Resources partners with business leaders to create and implement C&I plans to embed targeted strategies into organizations across Oracle. Employee satisfaction on the importance of C&I at Oracle and their managers’ leveraging a range of diverse perspectives and voices ranks high in our employee engagement surveys.
We have invested in the expansion of the Oracle Cloud by increasing existing data center capacity and adding additional data centers in new geographic locations to meet current and expected customer demand.
We have invested in the rapid expansion of the Oracle Cloud by increasing existing data center capacity and adding data centers in new geographic locations to meet current and expected customer demand. We expect this trend will continue.
Oracle storage products combine flash, disk, tape and server technologies with optimized software and unique integrations with the Oracle Database offering greater performance and efficiency and lower total cost relative to our competitors’ storage products.
Oracle storage products combine flash, disk, tape and server technologies with optimized software and unique integrations with the Oracle Database offering greater performance and efficiency and lower total cost relative to our competitors’ storage products. Certain of our storage products provide integration with Oracle Cloud Services for backup and archiving.
OCI is designed to be differentiated from other cloud 7 Table of Contents Index to Financial Statements vendors to provide better security by separating cloud control code computers from customer compute nodes.
OCI is designed to be differentiated from other cloud vendors to provide better security by separating cloud control code computers from customer compute nodes.
Levey served as Chief Executive Officer of Diem Association from August 2020 until June 2022, and as Chief Legal Officer of HSBC Holdings, plc from January 2012 to August 2020. Ms. Smith, 57, has been our Executive Vice President, Chief Accounting Officer since December 2022.
Levey, 61, has been our Executive Vice President, Chief Legal Officer since October 2022. Prior to joining Oracle, Mr. Levey served as Chief Executive Officer of Diem Association from August 2020 until June 2022, and as Chief Legal Officer of HSBC Holdings, plc from January 2012 to August 2020. Ms.
Oracle Cloud Operations leverage automated software tools to enable the rapid delivery of the latest cloud technology capabilities to the Oracle Cloud as they become available, providing Oracle customers access to the latest Oracle releases generally on a quarterly cadence.
Oracle Cloud Operations leverage automated software tools to enable the rapid delivery of the latest cloud technology capabilities to the Oracle Cloud as they become available and provide Oracle customers access to the latest Oracle releases.
He served as our Chief Executive Officer from June 1977, when he founded Oracle, until September 2014. He has served as a Director since June 1977. He previously served as our Chairman of the Board from May 1995 to January 2004. He currently serves as a director of Tesla, Inc. Ms.
He served as our Chief Executive Officer from June 1977, when he founded Oracle, until September 2014. He has 17 Table of Contents Index to Financial Statements served as a Director since June 1977. He previously served as our Chairman of the Board of Directors from May 1995 to January 2004. Ms.
We expect this trend will continue. 11 Table of Contents Index to Financial Statements Manufacturing We rely on third-party manufacturing partners to produce most of our hardware products that we market and sell to customers and utilize internally to deliver Oracle Cloud Services, and we distribute most of our hardware products from these partners’ facilities.
Manufacturing We rely on third-party manufacturing partners to produce most of our hardware products that we market and sell to customers and utilize internally to deliver Oracle Cloud Services, and we distribute most of our hardware products from these partners’ facilities.
Among our other middleware license offerings, we license development tools, such as Oracle WebLogic Server for Java application development, and Oracle Identity Manager, which automates user identity provisioning and allows 9 Table of Contents Index to Financial Statements enterprises to manage the end-to-end lifecycle of user identities across all enterprise resources.
Among our other middleware license offerings, we license development tools, such as Oracle WebLogic Server for Java application development, and Oracle Identity Manager, which automates user identity provisioning and allows enterprises to manage the end-to-end lifecycle of user identities across all enterprise resources. Organizations may elect to purchase license support, as described above, for Oracle Middleware licenses.
Examples of recognition received include being named one of the World’s Top Female-Friendly Companies and one of America’s Best Employers For Women by Forbes in 2022 and one of America’s Best Employers For Diversity by Forbes in 2023; a Best Place to Work by the Disability Equality Index in 2022 for the fifth consecutive year; a 2022 Best Place to Work for LGBTQ+ Equality 13 Table of Contents Index to Financial Statements by the Human Rights Campaign; a 2023 5-Star Employer by VETS Indexes; and a 2023 Top Supporter of Historically Black College and University Engineering Schools by Career Communications Group.
Examples of recognition received include being named one of the World’s Best Employers and World’s Top Companies for Women by Forbes in 2023 and one of America’s Best Employers For Diversity by Forbes in 2024; a Best Place to Work by the Disability Equality Index in 2023 for the sixth consecutive year; a 2023/2024 Best Place to Work for LGBTQ+ Equality by the Human Rights Campaign; a 2024 5-Star Employer by VETS Indexes; one of the Top 50 Workplaces for Indigenous STEM Professionals by American Indian Science and Engineering Society in 2024; and a 2023 Top Supporter of Historically Black College and University Engineering Schools by Career Communications Group.
Our OCI offerings also include cloud-based compute, storage and networking capabilities, application development and cloud native services, among others, and new and innovative services such as Oracle Autonomous Database (described further below), MySQL HeatWave, AI Infrastructure offerings and emerging technologies such as IoT, digital assistant and blockchain.
Our OCI offerings also include cloud-based compute, storage and networking capabilities, application development and cloud native services, among others, and new and innovative services such as AI Infrastructure offerings and emerging technologies such as generative AI, IoT and blockchain.
Workforce As of May 31, 2023, we employed approximately 164,000 full-time employees, of which approximately 62,000 were employed in the U.S. and approximately 102,000 were employed internationally.
Workforce As of May 31, 2024, we employed approximately 159,000 full-time employees, of which approximately 58,000 were employed in the U.S. and approximately 101,000 were employed internationally.
None of our employees in the U.S. are represented by labor unions; however, in certain foreign subsidiaries, labor unions or workers’ councils represent some of our employees. Diversity and Inclusion We believe that D&I powers innovation and that the diversity of our workforce is critical to helping our customers solve difficult problems.
None of our employees in the U.S. are represented by labor unions; however, in certain foreign subsidiaries, labor unions or workers’ councils represent some of our employees. Culture and Inclusion We believe that C&I powers innovation.
She served as our Senior Vice President, Corporate Controller from December 2020 to December 2022, as our Senior Vice President, Assistant Corporate Controller from September 2017 to December 2020; and as our Vice President, Global Controllers Organization and Mergers and Acquisitions from November 2012 to September 2017. She held various other positions with us since joining Oracle in 1999.
She served as our Senior Vice President, Corporate Controller from December 2020 to December 2022, as our Senior Vice President, Assistant Corporate Controller from September 2017 to December 2020, and as our Vice President, Global Controllers Organization and Mergers and Acquisitions from November 2012 to September 2017.
Using Oracle technologies, our customers build, deploy, run, manage and support their internal and external products, services and business operations, including, for example, a global cloud applications developer that utilizes Oracle Cloud Infrastructure (OCI) to power its software-as-a-service (SaaS) offerings; a multi-national financial institution that runs its banking applications using Oracle Exadata Cloud@Customer; and a global consumer products company that leverages Oracle Fusion Cloud Enterprise Resource Planning for its accounting processes, risk management, supply chain and financial planning functions.
Using Oracle technologies, our customers build, deploy, run, manage and support their internal and external products, services and business operations, including, for example, an artificial intelligence (AI) product company that uses Oracle Cloud Infrastructure (OCI) to build and serve generative AI models; a global technology company that uses OCI to power its logistics and mobile application offerings; a multinational financial institution that runs its banking applications using Oracle Exadata Cloud@Customer; and a global consumer products company that leverages Oracle Fusion Cloud Enterprise Resource Planning (ERP) for its accounting processes, risk management, supply chain and financial planning functions.
Certain of our storage products provide integration with Oracle Cloud Services for backup and archiving. 10 Table of Contents Index to Financial Statements Oracle Industry-Specific Hardware Offerings We offer hardware products and services designed for certain specific industries, including, among others, our point-of-sale terminals and related hardware that are designed for managing businesses within the food and beverage, hotel and retail industries; hardware products for the healthcare industry; and hardware products and services for communications networks, including network signaling, policy control and subscriber data management solutions, and session border control technology.
Oracle Industry-Specific Hardware Offerings We offer hardware products and services designed for certain specific industries, including, among others, our point-of-sale terminals and related hardware that are designed for managing businesses within the food and beverage, hospitality and retail industries; hardware products for the healthcare industry; and hardware products and services for communications networks, including network signaling, routing and policy control and subscriber data management solutions for 5G technology.
We also offer Oracle Database as a cloud service, such as with OCI’s Exadata Database Service and Base Database Service. 8 Table of Contents Index to Financial Statements In addition to the Oracle Database, we offer a portfolio of specialized databases to address specific customer requirements, including MySQL, the world’s most popular open source database, as a cloud service with MySQL HeatWave or as an on-premise offering.
Oracle MySQL HeatWave In addition to the Oracle Database on OCI and Oracle Autonomous Database, we offer a portfolio of specialized databases to address specific customer requirements, including MySQL, the world’s most popular open source database, as a cloud service with Oracle MySQL HeatWave, as an on-premise offering or on other public cloud services.
Our employees take advantage of online classes and learning resources on business, leadership and technical skills, as well as webinars and learning opportunities that are designed to support employee and family well-being. Leaders Who Listen We believe that an important aspect of creating a culture and environment that supports employee, customer and business success is listening to employee feedback.
Our employees take advantage of instructor-led classes, virtual library content and online learning resources on sales, business, products, market/industry, leadership, technical skills and compliance, as well as well-being and personal development related topics. Leaders Who Listen We believe that an important aspect of creating a culture and environment that supports employee, customer and business success is listening to employee feedback.
Oracle Middleware Licenses We license our Oracle Middleware, which is a broad family of integrated application infrastructure software, for use in the Oracle Cloud, other cloud-based environments, on-premise data centers and related IT environments.
We also offer Oracle Database as a cloud service, such as with Oracle Exadata Database Service and Oracle Base Database Service. 10 Table of Contents Index to Financial Statements Oracle Middleware Licenses We license our Oracle Middleware, which is a broad family of integrated application infrastructure software, for use in the Oracle Cloud, other cloud-based environments, on-premise data centers and related IT environments.
Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 14 of Notes to Consolidated Financial Statements, both included elsewhere in this Annual Report, provide additional information related to our businesses and operating segments. Oracle Corporation was incorporated in 2005 as a Delaware corporation and is the successor to operations originally begun in June 1977.
Each business is comprised of a single operating segment. Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 14 of Notes to Consolidated Financial Statements, both included elsewhere in this Annual Report, provide additional information related to our businesses and operating segments.
Our license support contracts are generally priced as a percentage of the net fees paid by the customer to purchase the license, are typically one year in duration and are generally billed to the customer annually in advance. Oracle Infrastructure Technologies Oracle infrastructure technologies are marketed, sold and delivered through our cloud and license business and through our hardware business.
Our license support contracts are 7 Table of Contents Index to Financial Statements generally priced as a percentage of the net fees paid by the customer to purchase the license, are typically one year in duration and are generally billed to the customer annually in advance.
Oracle Services We offer services to help customers and partners maximize the performance of their investments in Oracle applications and infrastructure technologies. We believe that our services are differentiated based on our focus on Oracle technologies, extensive experience and broad sets of intellectual property and best practices.
We believe that our services are differentiated based on our expertise in Oracle technologies, extensive experience and broad sets of intellectual property and best practices.
In addition to the full suite of OCI offerings delivered by dozens of Oracle public cloud regions across the globe, we provide our customers with flexibility by offering certain OCI services within a customer’s own data center to address customer latency requirements and address restrictions imposed upon customers that operate in certain regulated industries, entities or jurisdictions with our Dedicated Region and Sovereign cloud offerings.
In addition to the full suite of OCI offerings delivered by Oracle public cloud regions across the globe and by our multicloud partnerships, we provide our customers with flexibility by offering certain OCI services within a customer’s own data center, such as: • Oracle Exadata Cloud@Customer, which is designed to enable customers to run Oracle Autonomous Database and Oracle Database securely in their own data centers behind their firewalls while having the services managed by Oracle; • OCI Dedicated Region, which is designed to enable customers to bring a self-contained OCI instance into their data centers while accessing a substantial portfolio of OCI and Oracle Cloud SaaS offerings; • OCI Sovereign Cloud, which is designed to enable customers to utilize OCI services while addressing customer latency requirements and addressing restrictions imposed upon customers that operate in certain regulated industries, entities or jurisdictions.
We endeavor to hire employees from a broad pool of talent with diverse backgrounds, perspectives and abilities and we believe Oracle’s leaders serve as role models for our diverse and inclusive workforce.
Our Chief Executive Officer is a woman and forty percent of the members of our Board of Directors are women and/or come from a diverse background. We endeavor to hire employees from a broad pool of talent with diverse backgrounds, experiences, perspectives and abilities, and we believe Oracle’s leaders serve as role models for the inclusive culture in our workforce.
We offer some of our Oracle Engineered Systems, including the Oracle Exadata Database Machine, among others, through flexible deployment options, including on-premise, as a cloud offering in OCI, and as a hybrid cloud offering in customer data centers.
We offer some of our Oracle Engineered Systems, including the Oracle Exadata Database Machine, among others, through flexible deployment options, including on-premise, as a cloud offering in OCI, and as a hybrid cloud offering in customer data centers. 11 Table of Contents Index to Financial Statements Oracle Servers We offer a wide range of Oracle server products that are designed for mission-critical enterprise environments and that are key components of our Oracle Engineered Systems and Oracle Cloud offerings.
Oracle Database Licenses Oracle Database is the world’s most popular enterprise database and is designed to enable reliable and secure storage, retrieval and manipulation of all forms of data.
Oracle MySQL HeatWave combines transactions, real-time analytics, machine learning and generative AI in one managed cloud service. Oracle Database Licenses Oracle Database is the world’s most popular enterprise database and is designed to enable reliable and secure storage, retrieval and manipulation of all forms of data.
Mr. Screven, 58, has been Executive Vice President, Chief Corporate Architect since May 2015. He served as our Senior Vice President, Chief Corporate Architect from November 2006 to April 2015 and as Vice President, Chief 16 Table of Contents Index to Financial Statements Corporate Architect from January 2003 to November 2006.
Screven, 59, has been our Executive Vice President, Chief Corporate Architect since May 2015. He served as our Senior Vice President, Chief Corporate Architect from November 2006 to April 2015 and as Vice President, Chief Corporate Architect from January 2003 to November 2006. He held various other positions with us since joining Oracle in 1986. Mr.
Oracle employees received more than three million hours of training in fiscal 2023 and accessed online learning content at an average rate of more than two million views per month.
We believe that Oracle Learning enables us to improve our employees’ learning experience and better measure learning consumption. Oracle employees received more than five million hours of training in fiscal 2024 and accessed online learning content at an average rate of approximately two million views per month.
By offering a range of server sizes and microprocessors, customers have the flexibility to choose the types of servers that they believe will be most appropriate and valuable for their particular IT environments.
By offering a range of server sizes and microprocessors, customers have the flexibility to choose the types of servers that they believe will be most appropriate and valuable for their IT environments. Oracle Storage Oracle storage products are engineered for cloud, on-premise and hybrid IT environments and designed to securely archive, back up, manage and protect customers’ mission-critical data assets.
We continue to evolve hardware support processes that are intended to proactively identify and solve quality issues and to increase the amount of new and renewed hardware support contracts sold in connection with sales of our hardware products. Hardware support contracts are generally priced as a percentage of net hardware products fees.
We continue to evolve hardware support processes that are intended to proactively identify and solve quality issues. Hardware support contracts are generally priced as a percentage of net hardware products fees. Oracle Services We offer services to help customers and partners maximize the performance of their investments in Oracle applications and infrastructure technologies.
We utilize a global, blended delivery model to optimize value for our customers and partners, consisting of consultants from local geographies, industry specialists and consultants from our global delivery and solution centers; and • advanced customer services, which are support services provided by Oracle to a customer on-site or remote to enable increased performance and higher availability of a customer’s Oracle products and services.
We utilize a global, blended delivery model to optimize value for our customers and partners, which involves the use of consultants from local geographies, industry specialists and consultants from our global delivery and solution centers; and • advanced customer services, which are support services provided by Oracle to a customer to enable increased performance and higher availability of a customer’s Oracle products and services. 12 Table of Contents Index to Financial Statements Oracle Cloud Operations Oracle Cloud Operations deliver our Oracle Cloud Services to customers through a secure, reliable, scalable, enterprise grade cloud infrastructure platform managed by Oracle employees within a global network of data centers, which we refer to as the Oracle Cloud.
Organizations may elect to purchase license support, as described above, for Oracle Middleware licenses. We also offer certain of our middleware capabilities as a part of our OCI offerings.
We also offer certain of our middleware capabilities as a part of our OCI offerings.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeRisks we may face in connection with our acquisition program include: • our ongoing business may be disrupted and our management’s attention may be diverted by acquisition, transition or integration activities; • we may have difficulties (1) managing an acquired company’s technologies or lines of business; (2) entering new markets where we have no, or limited, direct prior experience or where competitors may have stronger market positions; or (3) retaining key personnel from the acquired companies; • an acquisition may not further our business strategy as we expected, we may not integrate an acquired company or technology as successfully as we expected, we may impose our business practices or alter 21 Table of Contents Index to Financial Statements go-to-market strategies that adversely impact the acquired business or we may overpay for, or otherwise not realize the expected return on our investments, each or all of which could adversely affect our business or operating results and potentially cause impairment to assets that we recorded as a part of an acquisition, including intangible assets and goodwill; • our operating results or financial condition may be adversely impacted by (1) claims or liabilities that we assume from an acquired company or technology or that are otherwise related to an acquisition; (2) pre-existing contractual relationships that we assume from an acquired company, the termination or modification of which may be costly or disruptive to our business; and (3) unfavorable revenue recognition or other accounting treatment as a result of an acquired company’s business practices; • we may fail to identify or assess the magnitude of certain liabilities, shortcomings or other circumstances prior to acquiring a company or technology; • we may not realize any anticipated increase in our revenues from an acquisition for a number of reasons, including (1) if a larger than predicted number of customers decline to renew or terminate their contracts with the acquired company; (2) if we are unable to sell the acquired products or service offerings to our customer base; (3) if acquired customers do not elect to purchase our technologies due to differing business practices; or (4) if contract models utilized by an acquired company do not allow us to recognize revenues in a manner that is consistent with our current accounting practices; • we may have difficulty integrating acquired technologies, products, services and their related supply chain operations with our existing lines of business and related infrastructures; • we may have multiple product lines or services offerings as a result of our acquisitions that are offered, priced, delivered and supported differently, which could cause customer confusion and delays; • we may incur higher than anticipated costs (1) to support, develop and deliver acquired products or services; (2) for general and administrative functions that support new business models; or (3) to comply with regulations applicable to an acquired business that are more complicated than we had anticipated; • we may be unable to obtain timely approvals from, or may otherwise have certain limitations, restrictions, penalties or other sanctions imposed on us by worker councils or similar bodies under applicable employment laws as a result of an acquisition; • we may be unable to obtain required approvals from governmental authorities under competition and antitrust laws on a timely basis, if at all, and we may need to divest or dispose of assets or businesses or take other actions in order to obtain such approvals; • our use of cash to pay for acquisitions may limit other potential uses of our cash; • we incurred additional debt to finance our acquisition of Cerner in fiscal 2023 and in the future, we may have to incur additional debt to pay for other acquisitions or have to delay or not proceed with an acquisition if we cannot obtain the necessary funding to complete the acquisition in a timely manner or on favorable terms; and • we may experience additional or unexpected changes in how we are required to account for our acquisitions pursuant to U.S. generally accepted accounting principles, including arrangements that we may assume in an acquisition.
Biggest changeRisks we may face in connection with our acquisition program include: • our ongoing business may be disrupted and our management’s attention may be diverted by acquisition, transition or integration activities; • we may have difficulties (1) managing an acquired company’s technologies or lines of business; (2) entering new markets where we have no, or limited, direct prior experience or where competitors may have stronger market positions; or (3) retaining key personnel from the acquired companies; • an acquisition may not further our business strategy as we expected, we may not integrate an acquired company or technology as successfully as we expected, we may impose our business practices or alter go-to-market strategies that adversely impact the acquired business or we may overpay for, or otherwise not realize the expected return on our investments, each or all of which could adversely affect our business or operating results and potentially cause impairment to assets that we recorded as a part of an acquisition, including intangible assets and goodwill; • our operating results or financial condition may be adversely impacted by (1) claims or liabilities that we assume from an acquired company or technology or that are otherwise related to an acquisition; (2) pre-existing contractual relationships that we assume from an acquired company, the termination or 23 Table of Contents Index to Financial Statements modification of which may be costly or disruptive to our business; and (3) unfavorable revenue recognition or other accounting treatment as a result of an acquired company’s business practices; • we may fail to identify or assess the magnitude of certain liabilities, shortcomings or other circumstances prior to acquiring a company or technology; • we may not realize any anticipated increase in our revenues from an acquisition for a number of reasons, including (1) if a larger than predicted number of customers decline to renew or terminate their contracts with the acquired company; (2) if we are unable to sell the acquired products or service offerings to our customer base; (3) if acquired customers do not elect to purchase our technologies due to differing business practices; or (4) if contract models utilized by an acquired company do not allow us to recognize revenues in a manner that is consistent with our current accounting practices; • we may have difficulty integrating acquired technologies, products, services and their related supply chain operations with our existing lines of business and related infrastructures; • we may have multiple product lines or services offerings as a result of our acquisitions that are offered, priced, delivered and supported differently, which could cause customer confusion and delays; • we may incur higher than anticipated costs (1) to support, develop and deliver acquired products or services; (2) for general and administrative functions that support new business models; or (3) to comply with regulations applicable to an acquired business that are more complicated than we had anticipated; • we may be unable to obtain timely approvals from, or may otherwise have certain limitations, restrictions, penalties or other sanctions imposed on us by worker councils or similar bodies under applicable employment laws as a result of an acquisition; • we may be unable to obtain required approvals from governmental authorities under foreign direct investment, foreign subsidy, competition and antitrust laws on a timely basis, if at all, and we may need to divest or dispose of assets or businesses or take other actions to obtain such approvals; • our use of cash to pay for acquisitions may limit other potential uses of our cash; and • we may have to incur additional debt to pay for acquisitions or have to delay or not proceed with an acquisition if we cannot obtain the necessary funding to complete the acquisition in a timely manner or on favorable terms.
If a cyber-attack or other security incident results in unauthorized access to or modification of our customers’ or suppliers’ data, other external data, our own data or our IT systems, or if the services we provide to our customers are disrupted, or if our products or services are reported to have (or are perceived as having) security vulnerabilities, we could incur significant expenses and suffer substantial damage to our brand and reputation.
If a cyber-attack or other security incident results in unauthorized access to, or modification or exfiltration of, our customers’ or suppliers’ data, other external data, our own data or our IT systems, or if the services we provide to our customers are disrupted, or if our products or services are reported to have (or are perceived as having) security vulnerabilities, we could incur significant expenses and suffer substantial damage to our brand and reputation.
Any violation of these laws can subject us to significant liability, including fines, penalties and possible prohibition of sales of our products and services into one or more states or countries and result in a material adverse effect on the financial condition or results of operations of our cloud and hardware businesses.
Any violation of these laws can subject us to significant liability, including fines, penalties and possible prohibition of sales of our products and services into one or more states or countries and result in a material adverse effect on the financial condition or operations of our cloud and hardware businesses.
Our cloud and hardware operations are subject to state, federal and international laws governing protection of the environment, proper handling and disposal of materials used for these products, human health and safety, the use of certain chemical substances and the labor practices of suppliers, as well as local testing and labeling requirements.
Our cloud and hardware operations are subject to state, federal and international laws governing protection of the environment, proper handling and disposal of materials used for these operations, human health and safety, the use of certain chemical substances and the labor practices of suppliers, as well as local testing and labeling requirements.
Our general compensation program includes restricted stock units and performance-based equity, which are important tools in attracting and retaining employees in our industry. If our stock price performs poorly, it may adversely affect our ability to retain or attract employees.
Our general compensation program includes restricted stock units (RSUs) and performance-based equity, which are important tools in attracting and retaining employees in our industry. If our stock price performs poorly, it may adversely affect our ability to retain or attract employees.
As regulatory focus on privacy issues continues to increase and worldwide laws and regulations concerning the handling of personal information expand and become more complex, potential risks related to data collection and use within our business will intensify.
As regulatory focus on privacy issues continues to increase and worldwide laws and regulations concerning the handling of personal information expand and become more complex and stringent, potential risks related to data collection and use within our business will intensify.
Our sales to local, state, federal and foreign government customers expose us to business volatility and risks, including government budgeting cycles and appropriations, procurement regulations, governmental policy shifts, early termination of contracts, audits, investigations, sanctions and penalties.
Our sales to local, state, federal and foreign government customers expose us to business volatility and risks, including government budgeting cycles and appropriations, government shutdowns, procurement regulations, governmental policy shifts, early termination of contracts, audits, investigations, sanctions and penalties.
We are also subject to a variety of other risks and challenges in managing an organization operating globally, including those related to: • general economic conditions in each country or region; • political unrest, terrorism and war, including but not limited to the current Russia-Ukraine war, the economic impact thereof and the potential to subject our business to materially adverse consequences should the situation escalate beyond its current scope, including, among other potential impacts, the geographic proximity of the situation relative to the rest of Europe, where a material portion of our business is carried out; • the potential for other hostilities, including but not limited to escalating tensions between China and Taiwan; • public health risks, social risks and supporting infrastructure stability risks, particularly in areas in which we have significant operations; • fluctuations in currency exchange rates and related impacts on customer demand and our operating results; • difficulties in accessing or transferring funds from or converting currencies in certain countries that could lead to a devaluation of our net assets, in particular our cash assets, in that country’s currency; • regulatory changes, including government austerity measures in certain countries that we may not be able to sufficiently plan for or avoid that may unexpectedly impair bank deposits or other cash assets that we hold in these countries or that impose additional taxes that we may be required to pay in these countries; • common local business behaviors or regulatory requirements that conflict with our business ethics, practices and conduct policies; • longer payment cycles and difficulties in collecting accounts receivable; • overlapping tax regimes; and • reduced protection for intellectual property rights in some countries.
We are also subject to a variety of other risks and challenges in managing an organization operating globally, including those related to: • general economic conditions in each country or region; • political unrest, terrorism and war, including but not limited to the current Russia-Ukraine war, the economic impact thereof and the potential to subject our business to materially adverse consequences should the situation escalate beyond its current scope, including, among other potential impacts, the geographic proximity of the situation relative to the rest of Europe, where a material portion of our business is carried out; • the potential for other hostilities, including but not limited to further destabilization in the Middle East and tensions between China and Taiwan; • public health risks, social risks and supporting infrastructure stability risks, particularly in areas in which we have significant operations; • fluctuations in currency exchange rates and related impacts on customer demand and our operating results; • difficulties in accessing or transferring funds from or converting currencies in certain countries that could lead to a devaluation of our net assets, in particular our cash assets, in that country’s currency; • regulatory changes, including government austerity measures in certain countries that we may not be able to sufficiently plan for or avoid that may unexpectedly impair bank deposits or other cash assets that we hold in these countries or that impose additional taxes that we may be required to pay in these countries; • common local business behaviors or regulatory requirements that conflict with our business ethics, practices and conduct policies; • longer payment cycles and difficulties in collecting accounts receivable; • overlapping tax regimes; and • reduced protection for intellectual property rights in some countries.
In addition, U.S. and foreign governments have enacted or are considering enacting legislation or regulations, or may in the near future interpret existing legislation or regulations, in a manner that could significantly impact our ability, as well as the ability of our customers, partners and data providers, to collect, augment, analyze, use, transfer (including across national borders) and share personal and other information that is integral to certain services we provide.
In addition, U.S. federal and state as well as foreign governments have enacted or are considering enacting legislation or regulations, or may in the near future interpret existing legislation or regulations, in a manner that could significantly impact our ability, as well as the ability of our customers, partners and data providers, to collect, augment, analyze, use, transfer (including across national borders) and share personal and other information that is integral to certain services we provide.
If our competitors offer deep discounts on certain products or services or develop products that the marketplace considers more valuable, we may need to lower prices, introduce pricing models and offerings or offer other terms that are less favorable to us, in order to compete successfully. Any such changes may reduce revenues and margins and could adversely affect operating results.
If our competitors offer deep discounts on certain products or services or develop products that the marketplace considers more valuable, we may need to lower prices, introduce pricing models and offerings or offer other terms that are less favorable to us to compete successfully. Any such changes may reduce revenues and margins and could adversely affect operating results.
Compliance with these ever-changing environmental and other laws in a timely manner could increase our product design, development, procurement, manufacturing, delivery, cloud operations and administration costs, limit our ability to manage excess and obsolete non-compliant inventory, change our sales activities, or otherwise impact future financial results of our cloud and hardware businesses.
Compliance with these ever-changing environmental and other laws in a timely manner could increase our product design, development, procurement, manufacturing, delivery, cloud operations, insurance premiums and administration costs, limit our ability to manage excess and obsolete non-compliant inventory, change our sales activities, or otherwise impact future financial results of our cloud and hardware businesses.
We outsource a majority of our manufacturing, assembly, delivery and technology of, and certain component designs for, our hardware products to a variety of companies, many of which are located outside the U.S. From time to time, these partners experience production problems, delays or cannot meet our demand for products.
We outsource most of our manufacturing, assembly, delivery and technology of, and certain component designs for, our hardware products to a variety of companies, many of which are located outside the U.S. From time to time, these partners experience production problems, delays or cannot meet our demand for products.
In addition, our profitability and revenues could be adversely impacted if we lost one or more of our key customers for any reason, including as a result of any of the factors discussed above. Any such loss could also limit or reduce our growth in future periods.
In addition, our profitability and revenues could be adversely impacted if we lose one or more of our key customers for any reason, including as a result of any of the factors discussed above. Any such loss could also limit or reduce our growth in future periods.
Although we have implemented contracts, diligence programs, policies and procedures designed to ensure compliance with applicable laws and regulations, there can be no assurance that our employees, contractors, partners, suppliers, data providers or agents will not violate such laws and regulations or our contracts, policies and procedures.
Although we have implemented contracts, diligence programs, policies and procedures designed to address compliance with applicable laws and regulations, there can be no assurance that our employees, contractors, partners, suppliers, data providers or agents will not violate such laws and regulations or our contracts, policies and procedures.
In addition, our business may be adversely affected if: • we do not continue to develop and release new or enhanced products and services within the anticipated time frames; • infrastructure costs to deliver new or enhanced products and services take longer or result in greater costs than anticipated; • we are unable to increase our existing data center capacity or establish data centers in new geographic locations in a timely manner to meet current or expected customer demand; • we fail to meet our contractual service level commitments; • there is a delay in market acceptance of and difficulty in transitioning new and existing customers to new, enhanced or acquired product lines or services; • sanctions, export controls or other regulatory, legislative or other barriers prevent us from serving certain customers or restrict our customers from operating in specific jurisdictions; • there are changes in IT trends that we do not adequately anticipate or timely address with our product development efforts; • we do not optimize complementary product lines and services in a timely manner; or 17 Table of Contents Index to Financial Statements • we fail to adequately integrate, support or enhance acquired product lines or services.
In addition, our business may be adversely affected if: • we do not continue to develop and release new or enhanced products and services within the anticipated time frames; • infrastructure costs to deliver new or enhanced products and services take longer or result in greater costs than anticipated; • we are unable to increase our existing data center capacity or establish data centers in new geographic locations in a timely manner to meet current or expected customer demand; • we fail to meet our contractual service level commitments; • there is a delay in market acceptance of and difficulty in transitioning new and existing customers to new, enhanced or acquired product lines or services; • sanctions, export controls or other regulatory, legislative or other barriers prevent us from serving certain customers or restrict our customers from operating in specific jurisdictions; • there are changes in IT trends that we do not adequately anticipate or timely address with our product development efforts; • we do not optimize complementary product lines and services in a timely manner; or • we fail to adequately integrate, support or enhance acquired product lines or services.
Third parties may attempt to fraudulently induce customers, partners, employees or suppliers into disclosing sensitive information such as user names, passwords or other information in order to gain access to our data, our customers’, suppliers’ or partners’ data or the IT systems of Oracle, our customers, suppliers or partners.
Third parties may attempt to fraudulently induce customers, partners, employees or suppliers into disclosing sensitive information such as user names, passwords or other information to gain access to our data, our customers’, suppliers’ or partners’ data or the IT systems of Oracle, our customers, suppliers or partners.
Compliance with any further economic sanctions, export controls or other regulatory restrictions (and any retaliatory responses thereto) taken by the U.S. or other countries could prevent us from serving certain customers or restrict our customers from operating in specific jurisdictions, which could have an adverse effect on our operations and results of operations.
Compliance with any further economic sanctions, export controls or other regulatory restrictions (and any countermeasures thereto) taken by the U.S. or other countries could prevent us from serving certain customers or restrict us or our customers from operating in specific jurisdictions, which could have an adverse effect on our operations and results of operations.
In the technology industry, there is substantial and continuous competition for highly skilled business, product development, technical and other personnel. Hiring freezes or slowdowns may result in decreased productivity while existing employees take on additional roles and responsibilities, and may also lead to a shortage of sufficiently skilled employees in certain roles.
In the technology industry, there is substantial and continuous competition for highly skilled business, product development and technical personnel, particularly in the AI field. Hiring freezes or slowdowns may result in decreased productivity while existing employees take on additional roles and responsibilities, and may also lead to a shortage of sufficiently skilled employees in certain roles.
We may also need to refinance a portion of our outstanding debt as it matures. There is a risk that we may not be able to refinance existing debt or that the terms of any refinancing may not be as favorable as the terms of our existing debt.
We expect to refinance a portion of our outstanding debt as it matures. There is a risk that we may not be able to refinance existing debt or that the terms of any refinancing may not be as favorable as the terms of our existing debt.
Our supply chain operations could be disrupted by industry consolidation and component constraints or shortages, natural disasters, political unrest, public health crises, changes to trade laws or regulations, port stoppages or other transportation disruptions or slowdowns, or other factors affecting the countries or regions where these single source component vendors are located or where the products are being shipped (such as the tensions between China and Taiwan).
Our supply chain operations are affected by industry consolidation and component constraints or shortages, natural disasters, political unrest (such as the tensions between China and Taiwan), public health crises, changes to trade laws or regulations, port stoppages, shipping interruptions or other transportation disruptions or slowdowns, and other factors affecting the countries or regions where these single source component vendors are located or where the products are being shipped.
We expect to continue to receive such claims as: • we continue to expand into new businesses and acquire companies; • the number of products and competitors in our industry segments grows; • the use and support of third-party code (including open source code) becomes more prevalent in the industry; • the volume of issued patents continues to increase; and 24 Table of Contents Index to Financial Statements • non-practicing entities continue to assert intellectual property infringement in our industry segments.
We expect to continue to receive such claims as: • we continue to expand into new businesses and acquire companies; • the number of products and competitors in our industry segments grows; • the use and support of third-party code (including open source code) becomes more prevalent in the industry; • the volume of issued patents continues to increase; and • non-practicing entities continue to assert intellectual property infringement in our industry segments.
Taken together, the laws or regulations associated with the enhanced protection of personal and other types of data could greatly increase the size of potential fines related to data protection, and our cost of providing our products and services could result in changes to our business practices or even prevent us from offering certain services in jurisdictions in which we operate.
Taken together, the laws or regulations associated with the enhanced protection of personal and other types of data could greatly increase the size of potential fines related to data protection, and our cost of providing our products and services could result in changes to our business 25 Table of Contents Index to Financial Statements practices or even prevent us from offering certain services in jurisdictions in which we operate.
We could incur future losses in emerging market countries and other countries where we do business should their currencies become designated as highly inflationary. There are risks associated with our outstanding and future indebtedness. As of May 31, 2023, we had an aggregate of $90.5 billion of outstanding indebtedness that will mature between calendar year 2023 and calendar year 2061.
We could incur future losses in emerging market countries and other countries where we do business should their currencies become designated as highly inflationary. There are risks associated with our outstanding and future indebtedness. As of May 31, 2024, we had an aggregate of $86.9 billion of outstanding indebtedness that will mature between calendar year 2024 and calendar year 2061.
As these business models continue to evolve, we may not be able to compete effectively, generate significant revenues or maintain the profitability of our cloud offerings. Additionally, the increasing prevalence of cloud and SaaS delivery models offered by us and our competitors may unfavorably impact the pricing of our cloud and license offerings.
As these business models continue to evolve, we may not be able to compete effectively, generate significant revenues or maintain the profitability of our cloud offerings. Additionally, the increasing prevalence of various cloud offering models by us and our competitors may unfavorably impact the pricing of our cloud and license offerings.
All of these factors could materially impact our results of operations, financial position and cash flows. We have incurred foreign currency losses associated with the devaluation of currencies in certain highly inflationary economies relative to the U.S. Dollar.
All of these factors could materially impact our results of operations, financial position and cash flows. 31 Table of Contents Index to Financial Statements We have incurred foreign currency losses associated with the devaluation of currencies in certain highly inflationary economies relative to the U.S. Dollar.
We continue to monitor relations between the U.S. and the Russian Federation, the Republic of Belarus and the People’s Republic of China, among others. It is difficult to anticipate the effect such relations may have on us.
In addition, we continue to monitor relations between the U.S. and the Russian Federation, the Republic of Belarus and the People’s Republic of China, among others. It is difficult to anticipate the effect international relations may have on us.
Federal Trade Commission continues to fine companies for unfair and deceptive data protection practices, and these fines may increase in size.
The U.S. Federal Trade Commission continues to fine companies for unfair and deceptive data protection practices, and these fines may increase in size.
If we are unable to develop new or sufficiently differentiated products and services, enhance and improve our product offerings and support services in a timely manner or position and price our products and services to meet demand, customers may not purchase or subscribe to our license, hardware or cloud offerings or renew license support, hardware support or cloud subscriptions contracts.
We have continued to refresh and release new offerings of our cloud products and services, but if we are unable to develop new or sufficiently differentiated products and services, enhance and improve our product offerings and support services in a timely manner or position and price our products and services to meet demand, customers may not purchase or subscribe to our license, hardware or cloud offerings or renew license support, hardware support or cloud subscriptions contracts.
Any failure to maintain high-quality technical support, or a market perception that we do not maintain high-quality technical support, could adversely affect our reputation, 19 Table of Contents Index to Financial Statements our ability to sell and renew our applications and infrastructure offerings to existing and prospective customers, and our business, operating results, and financial position.
Any failure to maintain high-quality technical support, or a market perception that we do not maintain high-quality technical support, could adversely affect our reputation, our ability to sell and renew our applications and infrastructure offerings to existing and prospective customers, and our business, operating results, and financial position.
Our products and services, including Oracle Cloud Services, store, retrieve, manipulate and manage third-party data, such as our customers’ information and data, as well as our own data.
Our products and services, including Oracle Cloud Services, store, retrieve, process and manage third-party data, such as our customers’ data, as well as our own data.
We are also subject to early termination of our contracts. Many governmental entities have the right to terminate contracts at any time for a variety of reasons, including without cause. For example, the U.S. federal government may terminate any of our government contracts and subcontracts at its convenience, or for default based on our performance.
Many governmental entities have the right to terminate contracts at any time for a variety of reasons, including without cause. For example, the U.S. federal government may terminate any of our government contracts and subcontracts at its convenience, or for default based on our performance.
Macroeconomic developments such as the global or regional economic effects resulting from increasing inflation rates, limited liquidity, adverse developments affecting financial institutions, the current Russia-Ukraine war and related economic curtailment initiatives, evolving trade policies between the U.S. and international trade partners, or the occurrence of similar events in other countries that lead to uncertainty or instability in economic, political or market conditions could negatively affect our business, operating results, financial condition and outlook, which, in turn, could adversely affect our stock price.
Macroeconomic developments such as the global or regional economic effects resulting from elevated inflation and interest rates, limited liquidity, adverse developments affecting financial institutions, the current wars, evolving trade policies between the U.S. and international trade partners, or the occurrence of similar events in other countries that lead to uncertainty or instability in economic, political or market conditions could negatively affect our business, operating results, financial condition and outlook, which, in turn, could adversely affect our stock price.
These types of restructurings have resulted, and may in the future result, in increased restructuring costs and temporary reduced productivity while the employees adjusted to their new roles and responsibilities. These types of restructurings may also lead to a shortage of sufficiently skilled employees in certain roles.
These types of restructurings have resulted, and may in the future result, in increased restructuring costs and temporary reduced productivity while employees adjust to the restructuring. These types of restructurings may also lead to a shortage of sufficiently skilled employees in certain roles.
Errors in our cloud, license or hardware offerings could affect their ability to properly function, integrate or operate with other cloud, license or hardware offerings, could result in service interruptions, delays or outages of our cloud offerings, could create security vulnerabilities in our products or services, could delay the development or release of new products or services or new versions of products or services, and could adversely affect market acceptance of our products or services.
Errors in our cloud, license or hardware offerings, or errors embedded in third-party software products or services incorporated into our own products, could affect their ability to properly function, integrate or operate with other cloud, license or hardware offerings, could result in service interruptions, delays or outages of our cloud offerings, could create security vulnerabilities in our products or services, could delay the development or release of new products or services or new versions of products or services, and could adversely affect market acceptance of our products or services.
Environmental legislation, such as the EU Directive on Restriction of Hazardous Substances (RoHS), the EU Waste Electrical and Electronic Equipment Directive (WEEE Directive) and China’s regulation on Management Methods for Controlling Pollution Caused by Electronic Information Products, among others, may increase our cost of doing business internationally and impact our hardware revenues from the EU, China and other countries with similar environmental legislation as we endeavor to comply with and implement these requirements.
Environmental legislation, such as the EU Waste Electrical and Electronic Equipment Directive, China’s regulation on Management Methods for Controlling Pollution Caused by Electronic Information Products and the EU carbon border adjustment mechanism, among others, may increase our cost of doing business internationally and impact our hardware revenues from the EU, China and other countries with similar environmental legislation as we endeavor to comply with and implement these requirements.
Enterprise customers rely on our cloud, license and hardware offerings and related services to run their businesses, and errors in our cloud, license and hardware offerings and related services 18 Table of Contents Index to Financial Statements could expose us to product liability, performance and warranty claims as well as significant harm to our brand and reputation, which could impact our future sales.
Enterprise customers rely on our cloud, license and hardware offerings and related services to run their businesses, and errors in our cloud, license and hardware offerings and related services could expose us to product liability, performance and warranty claims as well as significant harm to our brand and reputation, which could impact our future sales.
OCI’s multicloud services work with a number of our competitors’ products, including Microsoft Azure, Amazon Web Services and Google Cloud Platform. This multicloud strategy could lead our customers to migrate away from our cloud offerings to our competitors’ products, which could adversely affect our revenues and profitability.
OCI’s multicloud services work with a number of our competitors’ products, including Microsoft Azure, Amazon Web Services and Google Cloud Platform. This multicloud strategy could lead our customers to migrate away from our cloud offerings to our competitors’ products or limit their purchases of additional Oracle products, either of which could adversely affect our revenues and profitability.
Although we believe that our income and non-income based 25 Table of Contents Index to Financial Statements tax estimates are reasonable, there is no assurance that the final determination of tax audits or disputes will not be different from what is reflected in our historical income tax provisions and tax accruals.
Although we believe that our income and non-income based tax estimates are reasonable, there is no assurance that the final determination of tax audits or disputes will not be different from what is reflected in our historical income tax provisions and tax accruals.
For example, we will experience 29 Table of Contents Index to Financial Statements foreign currency gains and losses in certain instances if it is not possible or cost-effective to hedge our foreign currency exposures, if our hedging efforts are ineffective, or should we suspend our foreign currency forward contract program.
For example, we will experience foreign currency gains and losses in certain instances if it is not possible or cost-effective to hedge our foreign currency exposures, if our hedging efforts are ineffective, or should we suspend our foreign currency forward contract program.
Countries around the world continually consider and make changes to relevant tax, accounting and other laws, treaties, regulations, guidance and interpretations. In the U.S., certain enacted and proposed legislation may substantially raise U.S. income taxes on our domestic and international profits.
Countries around the world continually consider and make changes to relevant tax, accounting and other laws, treaties, regulations, guidance and interpretations. In the U.S., various legislative proposals, if enacted, may substantially raise U.S. income taxes on our domestic and international profits.
Our future income tax provisions and effective tax rate could materially increase under the tax changes discussed above or if other changes are made to applicable tax laws and rules in the U.S. or in other countries in which we do business.
These changes may materially increase the level of income tax on our international profits. Our future income tax provisions and effective tax rate could materially increase under the tax changes discussed above or if other changes are made to applicable tax laws and rules in the U.S. or in other countries in which we do business.
Renewals of these contracts are important to our future success. In addition, we cannot provide any assurance that the standards on which we choose to develop new products will allow us to compete effectively for business opportunities in emerging areas. We have continued to refresh and release new offerings of our cloud products and services.
Renewals of these contracts are important to our future success. In addition, we cannot provide any assurance that the standards on which we choose to develop new products will allow us to compete effectively for business opportunities in emerging areas.
Our stock price could also be affected by factors, some of which are beyond our control, including, among others: speculation in the press, social media and the analyst community; changes in recommendations or earnings related estimates by financial analysts; changes in investors’ or analysts’ valuation measures for our stock; negative analyst surveys or channel check surveys; earnings announcements where our financial results differ from our guidance or investors’ expectations; our credit ratings and market trends unrelated to our performance.
Our stock price could also be affected by factors, some of which are beyond our control, including, among others: speculation in the press, social media and the analyst community; changes in recommendations or earnings related estimates by financial analysts; changes in investors’ or analysts’ valuation measures for our stock; negative analyst surveys or channel check surveys; earnings announcements where our financial results differ from our guidance or investors’ expectations; our credit ratings; dissemination of inaccurate information or misinformation about our business and results of operations (including through the malicious use of generative AI tools); and market trends unrelated to our performance.
In addition, we outfit these data centers with equipment and improvements that we typically depreciate over their estimated useful lives, which could be shortened should our cloud strategies change, which could adversely affect our profitability. Our products and services may not function properly if we experience significant coding, manufacturing or configuration errors in our cloud, license and hardware offerings.
We typically depreciate these assets over their estimated useful lives, which could be shortened should our cloud strategies change, which could adversely affect our profitability. Our products and services may not function properly if we experience significant coding, manufacturing or configuration errors in our cloud, license and hardware offerings.
Regulatory, market, and competitive pressures regarding the greenhouse gas emissions and energy mix for our data center operations may also grow. A significant portion of our hardware revenues come from international sales.
Regulatory, market, carbon tax and competitive pressures regarding the greenhouse gas emissions and energy mix for our data center operations may also grow. Approximately half of our hardware revenues come from international sales.
A major natural disaster, political, social or other disruption to infrastructure that supports our operations or other catastrophic event or the effects of climate change (such as increased storm severity, drought and pandemics) that results in the destruction or disruption of any of our critical business operations, supply chains or IT systems could severely affect our ability to conduct normal business operations and, as a result, our future operating results could be materially and adversely affected.
Although the Oracle Cloud is designed to automatically redirect traffic to an alternate facility, in the event of a severe impact to one facility, a major natural disaster, political, social or other disruption to infrastructure that supports our operations or other catastrophic event or the effects of climate change (such as increased storm severity, drought and pandemics) that results in the destruction or disruption of any of our critical business operations, supply chains or IT systems could severely affect our ability to conduct normal business operations and, as a result, our future operating results could be materially and adversely affected.
We review and consider strategic acquisitions of companies, products, services and technologies. We have a selective and active acquisition program and we expect to continue to make acquisitions in the future because acquisitions have been an important element of our overall corporate strategy.
We have a selective and active acquisition program and we expect to continue to make acquisitions in the future because acquisitions have been an important element of our overall corporate strategy.
These include: • general economic and business conditions; • overall demand for enterprise cloud, license and hardware products and services; • governmental budgetary constraints or shifts in government spending priorities; and • general legal, regulatory and political developments.
These include: • general economic and business conditions; • overall demand for enterprise cloud, license and hardware products and services; • governmental budgetary constraints or shifts in government spending priorities; and 32 Table of Contents Index to Financial Statements • general legal, regulatory and political developments.
Our products and services, including our Oracle Cloud Services, may also be accessed or modified improperly as a result of customer, partner, employee, contractor or supplier error or malfeasance.
Our products and 24 Table of Contents Index to Financial Statements services, including our Oracle Cloud Services, may also be accessed or modified improperly as a result of customer, partner, employee, contractor or supplier error or malfeasance.
We believe that Oracle in particular is a target for computer hackers and other bad actors because Oracle stores and processes large amounts of data, including in customer sectors involving particularly sensitive data such as health sciences (including patient health information), financial services, retail, hospitality and the government.
We believe that Oracle is a target for computer hackers, cyber threats and other bad actors because Oracle stores and processes large amounts of data, including sensitive data such as health sciences (including patient health information), financial services, retail, hospitality, telecommunications and government data.
Compliance with these cybersecurity requirements is complex and costly, and failure to meet, or delays in meeting, the required security controls could limit our ability to sell 27 Table of Contents Index to Financial Statements products and services, directly or indirectly, to the DoD and other federal and state government entities that implement similar cybersecurity requirements.
Compliance with these cybersecurity requirements is complex and costly, and failure to meet, or delays in meeting, the required security controls could limit our ability to sell products and services, directly or indirectly, to the DoD and other federal and state government entities that implement similar cybersecurity requirements. We are also subject to early termination of our contracts.
Further, new laws, regulations, policies, and international accords relating to ESG matters, including sustainability, climate change, human capital, and diversity, are being developed and formalized in the U.S., Europe and elsewhere, which may require specific, target-driven frameworks or disclosure requirements.
Further, new laws, regulations, policies, and international accords relating to ESG matters, including sustainability, climate change, human capital and diversity, some of which require specific, target-driven frameworks or disclosure requirements, are being developed, formalized and implemented in many jurisdictions.
Standards for reporting ESG metrics, including ESG-related disclosures that may be required by the SEC or other regulators, are complex and evolving, and the implementation and oversight of controls to comply with applicable reporting and disclosure standards could impose significant compliance costs.
Standards for reporting ESG metrics, including ESG-related disclosures, are complex and evolving, and the implementation and oversight of controls to comply with applicable reporting and disclosure standards could impose significant compliance costs.
We have an Environmental Steering Committee (ESC) comprised of senior individuals from a wide range of Oracle business units, including our Chief Sustainability Officer who oversees our overall sustainability strategy, including climate related risk mitigation.
The Nomination and Governance Committee of our Board of Directors oversees and periodically reviews our environmental, social and governance (ESG) programs, including environmental sustainability. We also have an Environmental Steering Committee (ESC) comprised of senior individuals from a wide range of Oracle business units, including our Chief Sustainability Officer who oversees our overall sustainability strategy, including climate related risk mitigation.
Such unfavorable tax legislation resulting from the shifting U.S. political landscape and economic environment create the potential for added volatility in our quarterly provision for income taxes and could have a material adverse impact on our future income tax provisions and effective tax rate.
Such unfavorable tax proposals, the prospects for which depend to a significant degree on the U.S. political landscape, create the potential for added volatility in our quarterly provision for income taxes and could have a material adverse impact on our future income tax provisions and effective tax rate.
Our periodic workforce restructurings and reorganizations can be disruptive. We are currently restructuring our workforce and in the past we have restructured or made other adjustments to our workforce in response to management changes, product changes, performance issues, changes in strategies, acquisitions and other internal and external considerations.
Our periodic workforce restructurings and reorganizations can be disruptive. We periodically restructure or make other adjustments to our workforce in response to management changes, product changes, performance issues, changes in strategies, acquisitions and other internal and external considerations.
Additional impacts and risks that we are not currently aware of may arise, and the COVID-19 pandemic may also heighten other risks described in this Risk Factors section. 22 Table of Contents Index to Financial Statements Data Privacy, Cybersecurity and Intellectual Property Risks If our security measures for our products and services are compromised and as a result, our data, our customers’ data or our IT systems are accessed improperly, made unavailable, or improperly modified, our products and services may be perceived as vulnerable, our brand and reputation could be damaged, the IT services we provide to our customers could be disrupted, and customers may stop using our products and services, any of which could reduce our revenue and earnings, increase our expenses and expose us to legal claims and regulatory actions.
Data Privacy, Cybersecurity and Intellectual Property Risks If our security measures for our products and services are compromised and as a result, our data, our customers’ data or our IT systems are accessed improperly, made unavailable, or improperly modified, our products and services may be perceived as vulnerable, our brand and reputation could be damaged, the IT services we provide to our customers could be disrupted, and customers may stop using our products and services, any of which could reduce our revenue and earnings, increase our expenses and expose us to legal claims and regulatory actions.
Our acquisition of Cerner during fiscal 2023 also subjects us to additional data privacy and other related regulations governing the healthcare industry and patient information, including but not limited to regulations governing electronic health data transmissions, the processing of patient information, healthcare fraud and healthcare information sharing.
We are also subject to data privacy and other related regulations governing the healthcare industry and patient information, including but not limited to regulations governing electronic health data transmissions, the processing of patient information, healthcare fraud and healthcare information sharing.
Changes in the fair values of these investments have contributed, and may in the future contribute, to volatility in our net income that is not reflective of our core businesses. Changes in currency exchange rates can adversely affect customer demand and our revenue and profitability.
Changes in the fair values of these investments, including Ampere, have contributed, and may in the future contribute, to volatility in our net income that is not reflective of our core businesses.
As the majority shareholder of Oracle Financial Services Software Limited, a publicly traded company in India, and Oracle Corporation Japan, a publicly traded company in Japan, we face several additional risks, including being subject to local securities regulations and being unable to exert full control that we would otherwise have if these entities were wholly-owned subsidiaries.
As the majority shareholder of Oracle Financial Services Software Limited, a publicly traded company in India, and Oracle Corporation Japan, a publicly traded company in Japan, we face several additional risks, including being subject to local securities regulations and being unable to exert full control that we would otherwise have if these entities were wholly-owned subsidiaries. 28 Table of Contents Index to Financial Statements The healthcare industry is highly regulated, and thus, we are subject to several laws, regulations and industry initiatives, non-compliance with certain of which could adversely affect our healthcare business.
Congress is considering several privacy and security-related bills at the federal level, the federal government is pursuing a range of cybersecurity initiatives pertaining to critical infrastructure companies and government contractors, and a number of other state legislatures are considering privacy laws. Regulators globally are also imposing greater monetary fines for privacy violations.
This is true in the U.S. where, for example, a number of states have enacted privacy laws, the U.S. Congress is considering several privacy and security-related bills at the federal level, the federal government is pursuing a range of cybersecurity initiatives pertaining to critical infrastructure companies and government contractors, and a number of other state legislatures are considering privacy laws.
There can be no assurance that we will be successful in maintaining, expanding or developing our relationships with channel participants. If we are not successful, we may lose sales opportunities, customers and revenues. Acquisitions present many risks and we may not achieve the financial and strategic goals that were contemplated at the time of a transaction.
There can be no assurance that we will be successful in maintaining, expanding or developing our relationships with channel participants. If we are not successful, we may lose sales opportunities, customers and revenues.
A failure by the ESC to identify and assess these risks could adversely affect our reputation, business, financial performance and growth. We publish an annual Social Impact Report, which includes disclosure of our Environmental, Social and Governance (ESG) matters and goals.
Any failure to identify and assess these risks could adversely affect our reputation, business, financial performance and growth. We publish an annual Social Impact Report, which includes disclosure of our ESG matters and goals. Our disclosures on these matters, and standards we set for ourselves or a failure to meet these standards, may potentially harm our reputation and brand.
Our cloud offerings and hardware offerings are complex, and if we cannot successfully manage this complexity, including the sourcing of technologies and components, the results of these businesses will suffer.
However, we do not expect to receive significant revenues from these investments for several years, if at all. Our cloud offerings and hardware offerings are complex, and if we cannot successfully manage this complexity, including the sourcing of technologies and components, the results of these businesses will suffer.
The Organization for Economic Cooperation and Development (OECD) and the G20 have developed a two-pillar framework that would provide greater taxing rights to market jurisdictions where customers or users are located and implement a 15% global minimum tax on multinational corporate groups.
The Organisation for Economic Co-operation and Development (OECD) and the Group of Twenty (G20), together with over 140 participating countries, have developed a two-pillar framework calling for a 15% global minimum tax on multinational corporate groups, which has been adopted in many jurisdictions, and that would provide greater taxing rights to market jurisdictions where customers or users are located.
As a multinational corporation, we incur income taxes as well as non-income based taxes (such as payroll, sales, use, property and value-added taxes) in both the U.S. and various foreign jurisdictions.
We may be subjected to increased taxes due to changes in U.S. or international tax laws or from adverse resolutions of tax audits and controversies. As a multinational corporation, we incur income taxes as well as non-income based taxes (such as payroll, sales, use, property and value-added taxes) in both the U.S. and various foreign jurisdictions.
The results of our litigation also cannot be predicted with certainty. Even a favorable judgment may be subject to appeals leading to protracted litigation, additional costs and the prospect that our desired outcome will be overturned. An adverse decision could result in monetary damages or injunctive relief that could affect our business, operating results or financial condition.
The results of our litigation also cannot be predicted with certainty. Even a favorable judgment 26 Table of Contents Index to Financial Statements may be subject to appeals leading to protracted litigation, additional costs and the prospect that our desired outcome will be overturned.
Rapid technological advances, intense competition, changing delivery models and evolving standards in computer hardware and software development and communications infrastructure, changing and increasingly sophisticated customer needs and frequent new product introductions and enhancements characterize the industries in which we compete.
Our industry is characterized by rapid technological advances, intense competition, changing delivery models, evolving standards in communications infrastructure, increasingly sophisticated customer needs and frequent new product introductions and enhancements.
If one or more of the risks described above occurs, our cloud and license business and hardware business and related operating results could be materially and adversely affected. Supply chain shortages have in some instances resulted in increases to the costs of production of our hardware products that we may not be able to pass on to our customers.
Supply chain shortages have in some instances resulted in increases to the costs of production of our hardware products that we may not be able to pass on to our customers.
Our disclosures on these matters, and standards we set for ourselves or a failure to meet these standards, may potentially harm our reputation and brand. By electing to set and share publicly these corporate ESG standards, our business may also face increased scrutiny related to ESG activities.
By electing to set and share publicly these corporate ESG standards, our business may also face increased scrutiny related to ESG initiatives and activities.
This includes third-party software products or services incorporated into our own. If we experience any of these errors, or if there are delays in releasing our cloud, license or hardware offerings or new versions of these offerings, our sales could be affected and revenues could decline.
If we experience any of these errors, or if there are delays in releasing our cloud, license or hardware offerings or new versions of these offerings, our sales could be affected and revenues could decline. In addition, we run Oracle’s business operations as well as cloud and other services that we offer to our customers on our products and networks.
The timing and amount of changes in fair value, if any, of these investments depends on factors beyond our control, including the perceived and actual performance of the companies or funds in which we invest.
The timing and amount of impairment charges or changes in fair value, if any, of these investments depends on factors beyond our control, including the perceived and actual performance of the companies or funds in which we invest, and are also subject to the general conditions of public and private equity markets, which are uncertain and have in the past varied, and may in the future vary, materially by period.
We continually evaluate our compensation practices and consider changes from time to time, such as reducing the number of employees granted equity awards or the number of equity awards granted per employee and granting alternative forms of stock-based compensation, which may have an impact on our ability to retain employees and the amount of stock-based compensation expense that we record.
We continually evaluate our compensation practices and consider changes from time to time, which may have an impact on our ability to retain employees and the amount of stock-based compensation expense that we record. Any changes in our compensation practices or those of our competitors could affect our ability to retain and motivate existing personnel and recruit new personnel.
Any such violations could result in prohibitions on our ability to offer our products and services in one or more countries or territories or to certain entities, could delay or prevent potential acquisitions and could also materially damage our reputation, our brand, our international expansion efforts, our ability to attract and retain employees, our business and our operating results.
Any such violations could result in prohibitions on our ability to offer our products and services in one or more countries or territories or to certain entities, could delay or prevent potential acquisitions and could also materially damage our reputation, our brand, our international expansion efforts, our ability to attract and retain employees, our business and our operating results. 27 Table of Contents Index to Financial Statements Changes to sanctions or export control regulations in the U.S. and the other jurisdictions where we currently operate or have dealings, or in the future may operate or have dealings, can require suspension or termination of business (including financial transactions) in or with certain countries and territories or with certain customers.
However, we do not expect to receive significant revenues from these investments for several years, if at all. Legal and Regulatory Risks Adverse litigation results could affect our business. We are subject to various legal proceedings. Litigation can be lengthy, expensive and disruptive to our operations, and can divert our management’s attention away from running our core business.
If we cannot protect our intellectual property against unauthorized copying or use, or other misappropriation, we may not remain competitive. Legal and Regulatory Risks Adverse litigation results could affect our business. We are subject to various legal proceedings. Litigation can be lengthy, expensive and disruptive to our operations, and can divert our management’s attention away from running our core business.
In addition, we run Oracle’s business operations as well as cloud and other services that we offer to our customers on our products and networks. Therefore, any flaws could affect our and our customers’ abilities to conduct business operations and to ensure accuracy in financial processes and reporting, and may result in unanticipated costs and interruptions.
Therefore, any flaws could affect our and our customers’ 20 Table of Contents Index to Financial Statements abilities to conduct business operations and to ensure accuracy in financial processes and reporting, and may result in unanticipated costs and interruptions.
Our cloud and license, and hardware indirect channel networks are comprised primarily of resellers, system integrators/implementers, consultants, education providers, internet service providers, network integrators and independent software vendors. Our relationships with these channel participants are important elements of our cloud, software and hardware marketing and sales efforts.
There are risks associated with our cloud and license and hardware indirect sales channels which could affect our future operating results. Our cloud and license and hardware indirect channel networks are comprised primarily of resellers, system integrators/implementers, consultants, education providers, internet service providers, network integrators and ISVs.
We may be unable to respond quickly enough to accommodate short-term increases in customer demand for support services or may be inefficient in our resolution of customer support issues. Increased customer demand for these services, without corresponding revenues, could increase costs and adversely affect our operating results.
Our customers depend on our support organization to resolve technical issues relating to our applications and infrastructure offerings. We may be unable to respond quickly enough to accommodate short-term increases in customer demand for support services or may be inefficient in our resolution of customer support issues.
The GDPR provides for monetary penalties of up to 4% of an organization’s worldwide revenue. These penalties can be significant. For example, multiple U.S.-based technology companies have been fined between €225 million and €1.2 billion for alleged GDPR violations. The U.S.
Regulators globally are also imposing greater monetary fines for privacy violations. The GDPR provides for monetary penalties of up to €20 million, or up to 4% of an organization’s worldwide revenue of the preceding financial year, whichever is greater. These penalties can be significant. For example, a U.S.-based technology company was fined €1.2 billion for alleged GDPR violations in 2023.
While we make significant efforts to address any IT security issues with respect to our acquired companies, we may still inherit such risks when we integrate these companies within Oracle. 23 Table of Contents Index to Financial Statements Our business practices with respect to data could give rise to operational interruption, liabilities or reputational harm as a result of governmental regulation, legal requirements or industry standards relating to privacy and data protection.
Our business practices with respect to data could give rise to operational interruption, liabilities or reputational harm as a result of governmental regulation, legal requirements or industry standards relating to privacy and data protection.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe lease our principal internal manufacturing facility for our hardware products in Hillsboro, Oregon. Our cloud operations deliver our Oracle Cloud Services through the use of global data centers, substantially all of which were leased through colocation suppliers. We believe that our facilities are in good condition and suitable for the conduct of our business.
Biggest changeWe lease our principal internal manufacturing facility for our hardware products in Hillsboro, Oregon. Our cloud operations deliver our Oracle Cloud Services through the use of global data centers, substantially all of which were leased through colocation suppliers.
Item 2. P roperties Our properties consist of owned and leased office facilities for sales, support, research and development, services, manufacturing, cloud operations and administrative and other functions. Our headquarters facility consists of approximately 0.9 million square feet in Austin, Texas, all of which we own.
Item 2. Pro perties Our properties consist of owned and leased office facilities for cloud operations, sales, support, research and development, services, manufacturing and administrative and other functions. Our headquarters facility consists of approximately 0.9 million square feet in Austin, Texas, all of which we own.
We also own or lease other facilities for current use consisting of approximately 29.2 million square feet in various other locations in the U.S. and abroad. Approximately 9.6 million square feet, or 32%, of our total owned and leased space is sublet or is being actively marketed for sublease or disposition.
We also own or lease other facilities for current use consisting of approximately 27.7 million square feet in various other locations in the U.S. and abroad. Approximately 9.1 million square feet, or 32%, of our total owned and leased space is sublet or is being actively marketed for sublease or disposition.
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We believe that our facilities are in good condition and suitable for the conduct of our business. 35 Table of Contents Index to Financial Statements

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

2 edited+0 added−0 removed0 unchanged
Biggest changeItem 3. Lega l Proceedings The material set forth in Note 13 (pertaining to information regarding contingencies related to our income taxes) and Note 16 (pertaining to information regarding legal contingencies) of Notes to Consolidated Financial Statements in Item 15 of this Annual Report on Form 10-K is incorporated herein by reference. Item 4.
Biggest changeItem 3. Leg al Proceedings The material set forth in Note 13 (pertaining to information regarding contingencies related to our income taxes) and Note 16 (pertaining to information regarding legal contingencies) of Notes to Consolidated Financial Statements in Item 15 of this Annual Report is incorporated herein by reference. Item 4.
Mine Saf ety Disclosures Not applicable. 32 Table of Contents Index to Financial Statements PART II
M ine Safety Disclosures Not applicable. 36 Table of Contents Index to Financial Statements PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+1 added−1 removed2 unchanged
Biggest changeThe comparisons in the graphs below are based upon historical data and are not indicative of, nor intended to forecast, future performance of our common stock. *$100 INVESTED ON MAY 31, 2018 IN STOCK OR INDEX-INCLUDING REINVESTMENT OF DIVIDENDS 5/18 5/19 5/20 5/21 5/22 5/23 Oracle Corporation 100.0 110.1 119.0 177.2 164.2 246.2 S&P 500 Index 100.0 103.8 117.1 164.3 163.8 168.6 S&P Information Technology Index 100.0 104.4 144.5 206.1 210.2 250.8 Dow Jones U.S.
Biggest changeTechnology Total Return Index *$100 INVESTED ON MAY 31, 2019 IN STOCK OR INDEX-INCLUDING REINVESTMENT OF DIVIDENDS 5/19 5/20 5/21 5/22 5/23 5/24 Oracle Corporation 100.0 108.1 161.0 149.2 223.6 250.9 S&P 500 Index 100.0 112.8 158.3 157.9 162.5 208.3 Dow Jones U.S.
Item 5. Ma rket for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the New York Stock Exchange under the symbol “ORCL.” According to the records of our transfer agent, we had 7,297 stockholders of record as of May 31, 2023.
Item 5. Ma rket for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the New York Stock Exchange under the symbol “ORCL.” According to the records of our transfer agent, we had 6,921 stockholders of record as of May 31, 2024.
For equity compensation plan information, please refer to Item 12 in Part III of this Annual Report. Stock Repurchase Program Our Board of Directors has approved a program for us to repurchase shares of our common stock. As of May 31, 2023, approximately $8.2 billion remained available for stock repurchases pursuant to our stock repurchase program.
For equity compensation plan information, please refer to Item 12 in Part III of this Annual Report. Stock Repurchase Program Our Board of Directors has approved a program for us to repurchase shares of our common stock. As of May 31, 2024, approximately $7.0 billion remained available for stock repurchases pursuant to our stock repurchase program.
The following table summarizes the stock repurchase activity for the three months ended May 31, 2023 and the approximate dollar value of shares that may yet be purchased pursuant to our stock repurchase program: (in millions, except per share amounts) Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program March 1, 2023—March 31, 2023 0.6 $ 87.46 0.6 $ 8,258.5 April 1, 2023—April 30, 2023 0.5 $ 94.72 0.5 $ 8,214.0 May 1, 2023—May 31, 2023 0.5 $ 98.90 0.5 $ 8,162.4 Total 1.6 $ 93.29 1.6 33 Table of Contents Index to Financial Statements Stock Performance Graph and Cumulative Total Return The graph below compares the cumulative total stockholder return on our common stock with the cumulative total return of the S&P 500 Index, the S&P Information Technology Index and the Dow Jones U.S.
The following table summarizes the stock repurchase activity for the three months ended May 31, 2024 and the approximate dollar value of shares that may yet be purchased pursuant to our stock repurchase program: (in millions, except per share amounts) Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program March 1, 2024—March 31, 2024 0.4 $ 121.76 0.4 $ 7,065.6 April 1, 2024—April 30, 2024 0.4 $ 119.95 0.4 $ 7,014.0 May 1, 2024—May 31, 2024 0.4 $ 119.69 0.4 $ 6,962.3 Total 1.2 $ 120.42 1.2 37 Table of Contents Index to Financial Statements Stock Performance Graph and Cumulative Total Return The graph below compares the cumulative total stockholder return on our common stock with the cumulative total return of the S&P 500 Index and the Dow Jones U.S.
Technology Total Return Index 100.0 103.1 143.4 212.3 203.7 242.2 Item 6. [Rese rved] 34 Table of Contents Index to Financial Statements
Technology Total Return Index 100.0 139.1 205.9 197.5 234.9 329.3 Item 6. [Rese rved] 38 Table of Contents Index to Financial Statements
Technology Total Return Index for each of the last five fiscal years ended May 31, 2023, assuming an investment of $100 at the beginning of such period and the reinvestment of any dividends. We have elected to replace the S&P Information Technology Index with the Dow Jones U.S.
Technology Total Return Index for each of the last five fiscal years ended May 31, 2024, assuming an investment of $100 at the beginning of such period and the reinvestment of any dividends. The comparisons in the graphs below are based upon historical data and are not indicative of, nor intended to forecast, future performance of our common stock.
Removed
Technology Total Return Index because we believe the new index represents a more diversified group of companies across the technology industry and is more aligned with our peer group. In this transition year, the stock performance graph below includes the new index and the previously reported index.
Added
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN* Among Oracle Corporation, the S&P 500 Index and the Dow Jones U.S.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

112 edited+27 added−65 removed51 unchanged
Biggest changeNon-Operating Expenses, net : Non-operating expenses, net consists primarily of interest income, net foreign currency exchange losses, the noncontrolling interests in the net profits of our majority-owned subsidiaries (primarily Oracle Financial Services Software Limited and Oracle Corporation Japan), net losses related to equity investments including losses attributable to equity method investments and net other income and expenses, including net unrealized gains and losses from our investment portfolio related to our deferred compensation plan, and non-service net periodic pension income and losses. 50 Table of Contents Index to Financial Statements Year Ended May 31, Percent Change (Dollars in millions) 2023 Actual Constant 2022 Interest income $ 285 204% 214% $ 94 Foreign currency losses, net (249 ) 25% 27% (199 ) Noncontrolling interests in income (165 ) -11% -11% (184 ) Losses from equity investments, net (327 ) 122% 123% (147 ) Other losses, net (6 ) -92% -92% (86 ) Total non-operating expenses, net $ (462 ) -12% -12% $ (522 ) Our non-operating expenses, net decreased during fiscal 2023 relative to fiscal 2022 primarily due to higher interest income due to higher average interest rates that were applicable to our cash, cash equivalent and marketable securities balances; and lower other losses, net, which was primarily attributable to higher unrealized investment gain associated with certain marketable equity securities that we held for employee benefit plans, and for which an equal and offsetting amount was recorded to our operating expenses during the same period.
Biggest changeYear Ended May 31, Percent Change (Dollars in millions) 2024 Actual Constant 2023 Interest income $ 451 58% 59% $ 285 Foreign currency losses, net (228 ) -8% -11% (249 ) Noncontrolling interests in income (186 ) 13% 13% (165 ) Losses from equity investments, net (303 ) -7% -8% (327 ) Other income (expenses), net 168 * * (6 ) Total non-operating expenses, net $ (98 ) -79% -80% $ (462 ) * Not meaningful 52 Table of Contents Index to Financial Statements Our non-operating expenses, net decreased in fiscal 2024 relative to fiscal 2023 primarily due to higher interest income; lower net losses associated with equity investments; lower foreign currency losses; and higher other income, net, which was primarily attributable to unrealized investment gains associated with certain marketable equity securities that we held for employee benefit plans, and for which an equal and offsetting amount was recorded to our operating expenses during the same period.
On a constant currency basis, we expect that our total cloud and license revenues generally will continue to increase due to: • expected growth in our cloud services and license support offerings; and • continued demand for our cloud license and on-premise license offerings.
On a constant currency basis, we expect that our total cloud and license revenues generally will continue to increase due to: • expected growth in our cloud services offerings; and • continued demand for our cloud license and on-premise license and license support offerings.
Presentation of Operating Segment Results and Other Financial Information In our results of operations discussion below, we provide an overview of our total consolidated revenues, total consolidated operating expenses and total consolidated operating margin, all of which are presented on a GAAP basis.
Results of Operations Presentation of Operating Segment Results and Other Financial Information In our results of operations discussion below, we provide an overview of our total consolidated revenues, total consolidated operating expenses and total consolidated operating margin, all of which are presented on a GAAP basis.
Cloud and License Business Our cloud and license business engages in the sale and marketing of our applications and infrastructure technologies that are delivered through various deployment models and include: Oracle license support offerings; Oracle Cloud Services offerings; and Oracle cloud license and on-premise license offerings.
Cloud and License Business Our cloud and license business engages in the sale and marketing of our applications and infrastructure technologies that are delivered through various deployment models and include: Oracle Cloud Services offerings; Oracle cloud license and on-premise license offerings; and Oracle license support offerings.
We believe that free cash flow is also useful as one of the bases for comparing our performance with our competitors.
We believe that free cash flow is also useful as one of the bases for comparing our performance with that of our competitors.
License support revenues are typically generated through the sale of applications and infrastructure license support contracts related to cloud licenses and on-premise licenses; are purchased by our customers at their option; and are generally recognized as revenues ratably over the contractual term, which is generally one year.
License support revenues are typically generated through the sale of applications and infrastructure software license support contracts related to cloud licenses and on-premise licenses; are purchased by our customers at their option; and are generally recognized as revenues ratably over the contractual term, which is generally one year.
Our management approved, committed to and initiated the 2022 Restructuring Plan in order to restructure and further improve efficiencies in our operations. We may incur additional restructuring expenses in future periods due to the initiation of new restructuring plans or from changes in estimated costs associated with existing restructuring plans.
Our management approved, committed to and initiated the 2024 Restructuring Plan and the 2022 Restructuring Plan in order to restructure and further improve efficiencies in our operations. We may incur additional restructuring expenses in future periods due to the initiation of new restructuring plans or from changes in estimated costs associated with existing restructuring plans.
The descriptions set forth below as a part of this Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations and the information contained within Item 1 Business and Note 14 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report provide additional information related to our businesses and operating segments and align to how our chief operating decision makers (CODMs), which include our Chief Executive Officer and Chief Technology Officer, view our operating results and allocate resources.
The descriptions set forth below as a part of this Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations and the information contained within Item 1 Business and Note 14 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report provide additional information related to our businesses and operating segments and align to how our chief operating decision makers (CODMs), which are our Chief Executive Officer and Chief Technology Officer, view our operating results and allocate resources.
To address customer demand and enable customer choice, we have introduced certain programs for customers to pivot their applications and infrastructure licenses and the related license support to the Oracle Cloud for new deployments and to migrate to and expand with the Oracle Cloud for their existing workloads.
To address customer demand and enable customer choice, we have certain programs for customers to pivot their applications and infrastructure software licenses and the related license support to the Oracle Cloud for new deployments and to migrate to and expand with the Oracle Cloud for their existing workloads.
During fiscal 2023, we also borrowed $15.7 billion pursuant to the Bridge Credit Agreement which was fully repaid within the same period. Free cash flow : To supplement our statements of cash flows presented on a GAAP basis, we use non-GAAP measures of cash flows on a trailing 4-quarter basis to analyze cash flows generated from our operations.
During fiscal 2023 we borrowed $15.7 billion pursuant to the Bridge Credit Agreement, which was fully repaid within fiscal 2023. Free cash flow : To supplement our statements of cash flows presented on a GAAP basis, we use non-GAAP measures of cash flows on a trailing 4-quarter basis to analyze cash flows generated from our operations.
Our stock repurchases may be effected from time to time through open market purchases and pursuant to a Rule 10b5-1 plan. Our stock repurchase program may be accelerated, suspended, delayed or discontinued at any time.
Our stock repurchases may be effected from time to time through open market purchases or pursuant to a Rule 10b5-1 trading plan. Our stock repurchase program may be accelerated, suspended, delayed or discontinued at any time.
A discussion regarding our financial condition and results of operations for fiscal 2022 compared to fiscal 2021 can be found in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended May 31, 2022, as filed with the SEC on June 21, 2022, which is available free of charge on the SEC’s website at www.sec.gov and on our Investor Relations website at www.oracle.com/investor.
A discussion regarding our financial condition and results of operations for fiscal 2023 compared to fiscal 2022 can be found in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended May 31, 2023, as filed with the SEC on June 20, 2023, which is available free of charge on the SEC’s website at www.sec.gov and on our Investor Relations website at www.oracle.com/investor.
Notes 2, 7, 13 and 16 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report include additional information regarding our most material contractual obligations and contingencies.
Notes 7, 10, 13 and 16 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report include additional information regarding our most material contractual obligations and contingencies.
Contractual Obligations : Our largest contractual obligations as of May 31, 2023 consisted of: • principal payments related to our senior notes and other borrowings that are included in our consolidated balance sheet and the related periodic interest payments; • routine tax payments including those that are payable pursuant to the transition tax under the U.S.
Contractual Obligations : Our largest contractual obligations as of May 31, 2024 consisted of: • principal payments related to our senior notes and other borrowings that were included in our consolidated balance sheet and the related periodic interest payments; • routine tax payments including those that are payable pursuant to the transition tax under the U.S.
The majority of the initiatives undertaken by our 2022 Restructuring Plan were effected to implement our continued emphasis in developing, marketing, selling and delivering our cloud-based offerings.
The majority of the initiatives undertaken by the 2024 Restructuring Plan were effected to implement our continued emphasis in developing, marketing, selling and delivering our cloud-based offerings.
Services Business Our services business, which represented 11% and 8% of our total revenues in fiscal 2023 and 2022, respectively, helps customers and partners maximize the performance of their investments in Oracle applications and infrastructure technologies. We believe that our services are differentiated based on our focus on Oracle technologies, extensive experience, broad sets of intellectual property and best practices.
Services Business Our services business, which represented 10% and 11% of our total revenues in fiscal 2024 and 2023, respectively, helps customers and partners maximize the performance of their investments in Oracle applications and infrastructure technologies. We believe that our services are differentiated based on our focus on Oracle technologies, extensive experience, broad sets of intellectual property and best practices.
Refer to Note 2 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report for additional information related to our acquisition of Cerner and our other recent acquisitions. As compelling opportunities become available, we may acquire companies, products, services and technologies in furtherance of our corporate strategy.
Refer to Note 2 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report for additional information related to our acquisition of Cerner and our other recent acquisitions. As compelling 41 Table of Contents Index to Financial Statements opportunities become available, we may acquire companies, products, services and technologies in furtherance of our corporate strategy.
Business Overview Oracle provides products and services that address enterprise information technology (IT) environments. Our products and services include enterprise applications and infrastructure offerings that are delivered worldwide through a variety of flexible and interoperable IT deployment models. These models include on-premise, cloud-based and hybrid deployments (an approach that combines both on-premise and cloud-based deployments).
Business Overview Oracle provides products and services that address enterprise IT needs. Our products and services include enterprise applications and infrastructure offerings that are delivered worldwide through a variety of flexible and interoperable IT deployment models. These models include on-premise, cloud-based and hybrid deployments (an approach that combines both on-premise and cloud-based deployments).
The timing of a few large license transactions can substantially affect our quarterly license revenues due to the point-in-time nature of revenue recognition for license transactions, which is different than the typical revenue recognition pattern for our cloud services and license support revenues in which revenues are generally recognized ratably over the contractual terms.
The timing of a few large license transactions can substantially affect our quarterly license revenues due to the point-in-time nature of revenue recognition for license transactions, which is different than the typical revenue recognition pattern for our cloud services and license support revenues in which revenues are recognized over time.
Our cloud services and license support expenses have grown in recent periods, and we expect this growth to continue during fiscal 2024 as we increase our existing data center capacity and establish data centers in new geographic locations in order to meet current and expected customer demand.
Our cloud services and license support expenses have grown in recent periods, and we expect this trend to continue during fiscal 2025 as we increase our existing data center capacity and establish data centers in new geographic locations in order to meet current and expected customer demand.
In addition, as of May 31, 2023, we had $9.4 billion of gross unrecognized income tax benefits, including related interest and penalties, recorded on our consolidated balance sheet, the nature of which is uncertain with respect to settlement or release with the relevant tax authorities, although we believe it is reasonably possible that certain of these liabilities could be settled or released during fiscal 2024.
In addition, as of May 31, 2024, we had $11.0 billion of gross unrecognized income tax benefits, including related interest and penalties, recorded on our consolidated balance sheet, the nature of which is uncertain with respect to settlement or release with the relevant tax authorities, although we believe it is reasonably possible that certain of these liabilities could be settled or released during fiscal 2025.
Revenues for our cloud services are generally recognized over the contractual term, which is generally one to three years, or in the case of usage model contracts, as the cloud services are consumed.
Revenues for our cloud services are generally recognized ratably over the contractual term, which is generally one to four years, or in the case of usage model contracts, as the cloud services are consumed.
Certain of the cost savings realized pursuant to our 2022 Restructuring Plan initiatives were offset by investments in resources and geographies that better address the development, marketing, sale and delivery of our cloud-based offerings, including investments in the development and delivery of our second-generation cloud infrastructure.
Certain of the cost savings realized pursuant to the 2024 Restructuring Plan initiatives were offset by investments in resources and geographies that we believe better address the development, marketing, sale and delivery of our cloud-based offerings, including investments in the development and delivery of our second-generation cloud infrastructure.
The revenues for this combined performance obligation are generally recognized at the point in time that the hardware product is delivered to the customer and ownership is transferred to the customer.
The revenues for this combined performance obligation are generally recognized at the point in time that the hardware product and its related software are delivered to the customer and ownership is transferred to the customer.
This overview is followed by a summary of our critical accounting policies and estimates that we believe are important to understanding the assumptions and judgments incorporated in our reported financial results. We then provide a more detailed analysis of our results of operations and financial condition for fiscal 2023 compared to fiscal 2022.
This overview is followed by a summary of our critical accounting estimates that we believe are important to understanding significant assumptions and judgments incorporated in our reported financial results. We then provide a more detailed analysis of our results of operations and financial condition for fiscal 2024 compared to fiscal 2023.
Subsequent 39 Table of Contents Index to Financial Statements to the measurement period or final determination of the net asset values for the business combination, whichever comes first, changes in our estimates of such contingencies will affect earnings and could have a material effect on our results of operations and financial position.
Subsequent to the measurement period or final determination of the net asset values for the business combination, whichever comes first, changes in our estimates of such contingencies will affect earnings and could have a material effect on our results of operations and financial position.
Excluding the impact of our acquisition of Cerner, the constant currency revenues increase during fiscal 2023 relative to fiscal 2022 in our cloud and license business was attributable to growth in our cloud services and license support revenues as customers purchased our applications and infrastructure technologies via cloud and license deployment models and also renewed their related cloud contracts and license support contracts to continue to gain access to the latest versions of our technologies and to receive support services, partially offset by a decrease in our cloud license and on-premise license revenues.
The constant currency revenues increase in our cloud and license business in fiscal 2024 relative to fiscal 2023 was attributable to growth in our cloud services and license support revenues as customers purchased our applications and infrastructure technologies via cloud and license deployment models and also renewed their related cloud contracts and license support contracts to continue to gain access to the latest versions of our technologies and to receive support services, partially offset by a decrease in our cloud license and on-premise license revenues.
Cloud and License Business Our cloud and license business, which represented 83% and 85% of our total revenues in fiscal 2023 and 2022, respectively, markets, sells and delivers a broad spectrum of enterprise applications and infrastructure technologies through our cloud and license offerings.
Cloud and License Business Our cloud and license business, which represented 84% and 83% of our total revenues in fiscal 2024 and 2023, respectively, markets, sells and delivers a broad spectrum of enterprise applications and infrastructure technologies through our cloud and license offerings.
The proportion of our cloud services revenues relative to our total revenues has increased and we expect this trend to continue. Cloud services revenues represented 32%, 25% and 22% of our total revenues during fiscal 2023, 2022 and 2021, respectively.
The proportion of our cloud services revenues relative to our total revenues has increased and we expect this trend to continue. Cloud services revenues represented 37%, 32% and 25% of our total revenues during fiscal 2024, 2023 and 2022, respectively.
Our hardware revenues, cost of hardware and hardware operating margins that we report are affected by many factors, including our manufacturing partners’ abilities to timely manufacture or deliver a few large hardware transactions, with this factor becoming more pronounced in recent periods due to global supply chain constraints for certain technology components; our strategy for and the position of our hardware products relative to competitor offerings; customer demand for competing offerings, including cloud infrastructure offerings; the strength of general economic and business conditions; governmental budgetary constraints; whether customers decide to purchase hardware support contracts at or in close proximity to the time of hardware product sale; the percentage of our hardware support contract customer base that renews its support contracts; and the close association between hardware products, which have a finite life, and customer demand for related hardware support as hardware products age; customer decisions to either maintain or upgrade their existing hardware infrastructure to newly developed technologies that are available; and foreign currency rate fluctuations.
Our hardware revenues, cost of hardware and hardware operating margins that we report are affected by many factors, including our manufacturing partners’ abilities to timely manufacture or deliver a few large hardware transactions; our strategy for and the position of our hardware products relative to competitor offerings; customer demand for competing offerings, including cloud infrastructure offerings; the strength of general economic and business conditions; governmental budgetary constraints; whether customers decide to purchase hardware support contracts at or in close proximity to the time of hardware product sale; the percentage of our hardware support contract customer base that renews its support contracts; and the close association between hardware products, which have a finite life, and customer demand for related hardware support as hardware products age; customer decisions to either maintain or upgrade their existing hardware infrastructure to newly developed technologies that are available; and foreign currency rate fluctuations.
Tax Cuts and Jobs Act of 2017 that are included in our consolidated balance sheet; • operating lease liabilities that are included in our consolidated balance sheet; and • other contractual commitments associated with agreements that are enforceable and legally binding.
Tax Cuts and Jobs Act of 2017 that were included in our consolidated balance sheet; • operating lease liabilities that were included in our consolidated balance sheet; • operating lease commitments that have not yet commenced and were not included in our consolidated balance sheet; and • other contractual commitments associated with agreements that are enforceable and legally binding.
We consider future growth, forecasted earnings, future taxable income, the mix of earnings in the jurisdictions in which we operate, historical earnings, taxable income in prior years, if carryback is permitted under the law, and prudent and feasible tax planning strategies in determining 40 Table of Contents Index to Financial Statements the need for a valuation allowance.
We consider future growth, forecasted earnings, future taxable income, the mix of earnings in the jurisdictions in which we operate, historical earnings, taxable income in prior years, if carryback is permitted under the law, and prudent and feasible tax planning strategies in determining the need for a valuation allowance.
As of May 31, 2023, approximately $8.2 billion remained available for stock repurchases pursuant to our stock repurchase program. We repurchased 17.0 million shares for $1.3 billion, 185.8 million shares for $16.2 billion, and 329.2 million shares for $21.0 billion in fiscal 2023, 2022 and 2021, respectively.
As of May 31, 2024, approximately $7.0 billion remained available for stock repurchases pursuant to our stock repurchase program. We repurchased 10.6 million shares for $1.2 billion, 17.0 million shares for $1.3 billion, and 185.8 million shares for $16.2 billion in fiscal 2024, 2023 and 2022, respectively.
In June 2023, our Board of Directors declared a quarterly cash dividend of $0.40 per share of our outstanding common stock payable on July 26, 2023 to stockholders of record as of the close of business on July 12, 2023.
In June 2024, our Board of Directors declared a quarterly cash dividend of $0.40 per share of our outstanding common stock payable on July 25, 2024 to stockholders of record as of the close of business on July 11, 2024.
Each member of a separate executive officer committee, referred to as the Plan Committee, was allocated a fiscal 2023 equity budget that could be used throughout the fiscal year to grant equity within his or her organization, subject to certain limitations established by the Compensation Committee.
Each member of a separate executive officer committee, referred to as the Plan Committee, was allocated a fiscal 2024 equity budget that could be used throughout the fiscal year to grant equity subject to certain limitations established by the Compensation Committee.
As of May 31, 2023, the maximum potential dilution from all outstanding stock-based awards, regardless of when granted and regardless of whether vested or unvested, was 8.0%.
As of May 31, 2024, the maximum potential dilution from all outstanding stock-based awards, regardless of when granted and regardless of whether vested or unvested, was 6.9%.
Services revenues are generally recognized over time as the services are performed. 47 Table of Contents Index to Financial Statements The cost of providing our services consists primarily of personnel related expenses, technology infrastructure expenditures, facilities expenses and external contractor expenses.
Services revenues are generally recognized over time as the services are performed. The cost of providing our services consists primarily of personnel related expenses, technology infrastructure expenditures, facilities expenses and external contractor expenses.
Our operating results reported pursuant to GAAP included the following business combination accounting adjustments and expenses related to acquisitions and certain other expense and income items that affected our GAAP net income: Year Ended May 31, (in millions) 2023 2022 Amortization of intangible assets (1) $ 3,582 $ 1,150 Acquisition related and other (2) 190 4,713 Restructuring (3) 490 191 Stock-based compensation, operating segments (4) 1,201 735 Stock-based compensation, R&D and G&A (4) 2,346 1,878 Income tax effects (5) (2,136 ) (1,723 ) $ 5,673 $ 6,944 (1) Represents the amortization of intangible assets, substantially all of which were acquired in connection with our acquisitions.
Our operating results reported pursuant to GAAP included the following business combination accounting adjustments and expenses related to acquisitions and certain other expenses, including stock-based compensation, that affected our GAAP net income: Year Ended May 31, (in millions) 2024 2023 Amortization of intangible assets (1) $ 3,010 $ 3,582 Acquisition related and other (2) 314 190 Restructuring (3) 404 490 Stock-based compensation, operating segments (4) 1,382 1,201 Stock-based compensation, R&D and G&A (4) 2,592 2,346 Income tax effects (5) (2,459 ) (2,136 ) $ 5,243 $ 5,673 (1) Represents the amortization of intangible assets, substantially all of which were acquired in connection with our acquisitions.
Net cash provided by financing activities was $7.9 billion during fiscal 2023 compared to the net cash used for financing activities of $29.1 billion in fiscal 2022.
Net cash used for financing activities was $10.6 billion during fiscal 2024 compared to the net cash provided by financing activities of $7.9 billion in fiscal 2023.
Cash flows from investing activities : The changes in cash flows from investing activities primarily relate to our acquisitions, the timing of our purchases, maturities and sales of our investments in marketable securities, and investments in capital and other assets, including certain intangible assets, to support our growth.
Cash flows from investing activities : The changes in cash flows from investing activities primarily relate to our acquisitions, purchases, maturities and sales of our investments in marketable securities and other instruments and investments in capital assets primarily to support the growth in our cloud and license business.
As of May 31, 2023, estimated future amortization related to intangible assets was as follows (in millions): Fiscal 2024 $ 2,994 Fiscal 2025 2,283 Fiscal 2026 1,620 Fiscal 2027 664 Fiscal 2028 635 Thereafter 1,641 Total intangible assets, net $ 9,837 (2) Acquisition related and other expenses consist of personnel related costs for transitional and certain other employees, certain business combination adjustments including certain adjustments after the measurement period has ended and certain other operating items, net.
As of May 31, 2024, estimated future amortization related to intangible assets was as follows (in millions): Fiscal 2025 $ 2,303 Fiscal 2026 1,639 Fiscal 2027 672 Fiscal 2028 635 Fiscal 2029 561 Thereafter 1,080 Total intangible assets, net $ 6,890 (2) Acquisition related and other expenses consist of personnel related costs for transitional and certain other employees, certain business combination adjustments including certain adjustments after the measurement period has ended and certain other operating items, net.
Our services revenues are affected by many factors including our strategy for, and the competitive position of, our services; customer demand for our cloud and license and hardware offerings and the related services that we may market and sell in connection with these offerings; general economic conditions; governmental budgetary constraints; personnel reductions in our customers’ IT departments; tighter controls over customer discretionary spending; and foreign currency rate fluctuations. 37 Table of Contents Index to Financial Statements Acquisitions Our selective and active acquisition program is another important element of our corporate strategy.
Our services revenues are affected by many factors including our strategy for, and the competitive position of, our services; customer demand for our cloud and license and hardware offerings and the related services that we may market and sell in connection with these offerings; general economic conditions; governmental budgetary constraints; personnel reductions in our customers’ IT departments; tighter controls over customer discretionary spending; and foreign currency rate fluctuations.
In recent years, our stock repurchase program has more than offset the dilutive effect of our stock-based compensation program. However, we may modify the levels of our stock repurchases in the future depending on a number of factors, including the amount of cash we have available for acquisitions, to pay dividends, to repay or repurchase indebtedness or for other purposes.
However, we may modify the levels of our stock repurchases in the future depending on a number of factors, including the amount of cash we have available for acquisitions, to pay dividends, to repay or repurchase indebtedness or for other purposes.
The increase in net cash provided by financing activities was primarily due to the net cash proceeds from borrowings pursuant to the Term Loan Credit Agreement and the issuance of senior notes and commercial paper notes, net of repayments; lower stock repurchases; lower maturities of senior notes and higher net cash from our employee stock program, in each case during fiscal 2023 relative to fiscal 2022.
The increase in net cash used for financing activities was primarily due to the absence of the cash proceeds from borrowings pursuant to the issuance of senior notes and Term Loan Credit Agreement, higher repayments of commercial paper notes, net of issuances, higher net cash used for our employee stock programs and higher dividend payments, partially offset by lower maturities of senior notes and lower stock repurchases, in each case in fiscal 2024 relative to fiscal 2023.
The majority of our hardware products are sold through indirect channels, including independent distributors and value-added resellers. Our hardware support offerings provide customers with unspecified software updates for software components that are essential to the functionality of our hardware products and associated software products. Our hardware support offerings can also include product repairs, maintenance services and technical support services.
Our hardware support offerings provide customers with unspecified software updates for software components that are essential to the functionality of our hardware products and associated software products. Our hardware support offerings can also include product repairs, maintenance services and technical support services.
Stock-based awards activity from June 1, 2020 through May 31, 2023 is summarized as follows (shares in millions): Stock-based awards outstanding at May 31, 2020 277 Stock-based awards granted and assumed 200 Stock-based awards vested and issued and, if applicable, exercised (212 ) Forfeitures, cancellations and other, net (49 ) Stock-based awards outstanding at May 31, 2023 216 Annualized stock-based awards granted and assumed, net of forfeitures and cancellations 51 Annualized stock repurchases (177 ) Shares outstanding at May 31, 2023 2,713 Basic weighted-average shares outstanding from June 1, 2020 through May 31, 2023 2,780 Stock-based awards outstanding as a percent of shares outstanding at May 31, 2023 8.0% Total in the money stock-based awards outstanding (based on the closing price of our common stock on the last trading day of fiscal 2023) as a percent of shares outstanding at May 31, 2023 8.0% Annualized stock-based awards granted and assumed, net of forfeitures and cancellations and before stock repurchases, as a percent of weighted-average shares outstanding from June 1, 2020 through May 31, 2023 1.8% Annualized stock-based awards granted and assumed, net of forfeitures and cancellations and after stock repurchases, as a percent of weighted-average shares outstanding from June 1, 2020 through May 31, 2023 -4.5% Recent Accounting Pronouncements For information with respect to recent accounting pronouncements, if any, and the impact of these pronouncements on our consolidated financial statements, if any, see Note 1 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report. 55 Table of Contents Index to Financial Statements
Stock-based awards activity from June 1, 2021 through May 31, 2024 is summarized as follows (shares in millions): Stock-based awards outstanding as of May 31, 2021 217 Stock-based awards granted and assumed 195 Stock-based awards vested and issued and, if applicable, exercised (195 ) Forfeitures, cancellations and other, net (28 ) Stock-based awards outstanding as of May 31, 2024 189 Annualized stock-based awards granted and assumed, net of forfeitures and cancellations 56 Annualized stock repurchases (71 ) Shares outstanding as of May 31, 2024 2,755 Basic weighted-average shares outstanding from June 1, 2021 through May 31, 2024 2,713 Stock-based awards outstanding as a percent of shares outstanding as of May 31, 2024 6.9% Total in the money stock-based awards outstanding (based on the closing price of our common stock on the last trading day of fiscal 2024) as a percent of shares outstanding as of May 31, 2024 6.9% Annualized stock-based awards granted and assumed, net of forfeitures and cancellations and before stock repurchases, as a percent of weighted-average shares outstanding from June 1, 2021 through May 31, 2024 2.1% Annualized stock-based awards granted and assumed, net of forfeitures and cancellations and after stock repurchases, as a percent of weighted-average shares outstanding from June 1, 2021 through May 31, 2024 -0.6% Recent Accounting Pronouncements For information with respect to recent accounting pronouncements, and the impact of these pronouncements on our consolidated financial statements, see Note 1 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report.
In the ordinary course of a global business, there are many transactions and calculations where the ultimate tax outcome is uncertain.
Income Taxes Judgment is required in determining our worldwide income tax provision. In the ordinary course of a global business, there are many transactions and calculations where the ultimate tax outcome is uncertain.
In order to provide a framework for assessing how our underlying businesses performed, excluding the effects of foreign currency rate fluctuations, we compare the percent change in the results from one period to another period in this Annual Report using constant currency disclosure.
In order to provide a framework for assessing how our underlying businesses performed, excluding the effects of foreign currency rate fluctuations, we compare the percent change in the results from one period to another period in this Annual Report using constant currency. To present this information, current and comparative prior period results for entities reporting in currencies other than U.S.
Excluding the effects of currency rate fluctuations, our cloud and license business’ total margin increased in fiscal 2023 compared to fiscal 2022 due to increases in total revenues for this business. Total margin as a percentage of revenues for this business decreased in fiscal 2023 compared to fiscal 2022 due to expenses growth.
Excluding the effects of currency rate fluctuations, our cloud and license business’ total margin increased in fiscal 2024 relative to fiscal 2023 due to increases in total revenues for this business.
In constant currency, total margin as a percentage of revenues decreased in fiscal 2023 relative to fiscal 2022 due to expenses growth. Research and Development Expenses : Research and development expenses consist primarily of personnel related expenditures.
In constant currency, our services business’ total margin and total margin as a percentage of revenues decreased in fiscal 2024 relative to fiscal 2023 due to lower total revenues for this business. Research and Development Expenses : Research and development expenses consist primarily of personnel related expenditures.
These decreases were partially offset by higher net losses associated with equity investments and higher foreign currency losses. Provision for Income Taxes : Our effective income tax rates for each of the periods presented were the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates.
These decreases in non-operating expenses, net were partially offset by higher expenses for noncontrolling interests in income. Provision for Income Taxes : Our effective income tax rates for each of the periods presented were the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates.
The historical upward trend of our cloud and license business’ revenues over the course of the four quarters within a particular fiscal year is primarily due to the addition of new cloud services and license support contracts to the customer contract base that we generally recognize as revenues ratably or based upon customer usage over the respective contractual terms and the renewal of existing customers’ cloud services and license support contracts over the course of each fiscal year that we generally recognize as revenues in a similar manner; and the historical 36 Table of Contents Index to Financial Statements upward trend of our cloud license and on-premise license revenues, which we generally recognize at a point in time upon delivery; in each case over those four fiscal quarterly periods.
The historical upward trend of our cloud and license business’ revenues over the course of the four quarters within a particular fiscal year is primarily due to the addition of new cloud services and license support contracts to the customer contract base that we generally recognize as revenues ratably or based upon customer usage over the respective contractual terms and the renewal of existing customers’ cloud services and license support contracts over the course of each fiscal year that we generally recognize as revenues in a similar manner; and the historical upward trend of our cloud license and on-premise license revenues, which we generally recognize at a point in time upon delivery; in each case over those four fiscal quarterly periods. 40 Table of Contents Index to Financial Statements Hardware Business Our hardware business, which represented 6% of our total revenues in each of fiscal 2024 and 2023, provides a broad selection of enterprise hardware products and hardware-related software products including Oracle Engineered Systems, servers, storage, industry-specific hardware offerings, operating systems, virtualization, management and other hardware-related software and related hardware support.
Oracle Cloud Services arrangements are generally billed in advance of the cloud services being performed; generally have durations of one to three years; are generally renewed at the customer’s option; and are generally 35 Table of Contents Index to Financial Statements recognized as revenues ratably over the contractual period of the cloud contract or, in the case of usage model contracts, as the cloud services are consumed over time. • Cloud license and on-premise license revenues, which include revenues from the licensing of our software products including Oracle Applications, Oracle Database, Oracle Middleware and Java, among others, which our customers deploy within cloud-based, on-premise or other IT environments.
License support contracts are generally priced as a percentage of the net fees paid by the customer to purchase a cloud license and/or on-premise license; are generally billed in advance of the support services being performed; are generally renewed at the customer’s option; and are generally recognized as revenues ratably over the contractual period that the support services are provided, which is generally one year. 39 Table of Contents Index to Financial Statements • Cloud license and on-premise license revenues, which include revenues from the licensing of our software products including Oracle Applications, Oracle Database, Oracle Middleware and Java, among others, which our customers deploy within cloud-based, on-premise or other IT environments.
In constant currency, our total cloud and license business’ expenses increased in fiscal 2023 compared to fiscal 2022 primarily due to higher employee related expenses due to higher headcount; higher technology infrastructure expenses to support the increase in our cloud and license business’ revenues; and additional operating expenses due to our Cerner acquisition.
In constant currency, our total cloud and license business’ expenses increased in fiscal 2024 relative to fiscal 2023 primarily due to higher technology infrastructure expenses to support the increase in our cloud and license business’ revenues.
To present this information, current and comparative prior period results for entities reporting in currencies other than U.S. Dollars are converted into U.S. Dollars at constant exchange rates (i.e., the rates in effect on May 31, 2022, which was the last day of our prior fiscal year) rather than the actual exchange rates in effect during the respective periods.
Dollars are converted into U.S. Dollars at constant exchange rates (i.e., the rates in effect on May 31, 2023, which was the last day of our prior fiscal year) rather than the actual exchange rates in effect during the respective periods.
For a given business acquisition, we may identify certain pre-acquisition contingencies as of the acquisition date and may extend our review and evaluation of these pre-acquisition contingencies throughout the measurement period in order to obtain sufficient information to assess whether we include these contingencies as a part of the fair value estimates of assets acquired and liabilities assumed and, if so, to determine their estimated amounts.
Upon the conclusion of a business acquisition’s measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to our consolidated statements of operations. 42 Table of Contents Index to Financial Statements For a given business acquisition, we may identify certain pre-acquisition contingencies as of the acquisition date and may extend our review and evaluation of these pre-acquisition contingencies throughout the measurement period in order to obtain sufficient information to assess whether we include these contingencies as a part of the fair value estimates of assets acquired and liabilities assumed and, if so, to determine their estimated amounts.
As a result, during the measurement period, which may be up to one year from the business acquisition date, we record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill.
Unanticipated events and circumstances may occur that may affect the accuracy or validity of such assumptions, estimates or actual results. As a result, during the measurement period, which may be up to one year from the business acquisition date, we record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill.
Refer to “Supplemental Disclosure Related to Certain Charges” below for additional discussion of certain of these items and Note 14 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report for a reconciliation of the summations of total segment margin as presented in the discussion below to total income before income taxes as presented per our consolidated statements of operations for fiscal 2023 and 2022.
Refer to “Supplemental Disclosure Related to Certain Charges” below for additional discussion of certain of these items and Note 14 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report for a reconciliation of the summations of total segment margin as presented in the discussion below to total income before income taxes as presented per our consolidated statements of operations for fiscal 2024 and 2023. 44 Table of Contents Index to Financial Statements Constant Currency Presentation Our international operations have provided, and are expected to continue to provide, a significant portion of each of our businesses’ revenues and expenses.
For those tax related contingencies that are not a part of a business combination, we account for these uncertain tax issues pursuant to ASC 740, Income Taxes , which contains a two-step approach to recognizing and measuring uncertain tax positions taken or expected to be taken in a tax return.
A description of our accounting policies associated with tax related contingencies assumed as a part of a business combination is provided under “Business Combinations” above. 43 Table of Contents Index to Financial Statements For those tax related contingencies that are not a part of a business combination, we account for these uncertain tax issues pursuant to ASC 740, Income Taxes , which contains a two-step approach to recognizing and measuring uncertain tax positions taken or expected to be taken in a tax return.
During fiscal 2023, the Compensation Committee of the Board of Directors reviewed and approved the annual organization-wide stock-based award grants to selected employees; all stock-based award grants to senior officers; and any individual grant of restricted stock units of 62,500 or greater.
During fiscal 2024, the Compensation Committee reviewed and approved the annual organization-wide stock-based award grants to selected employees; all stock-based award grants to senior officers; and any individual grant of RSUs with a value of $5 million or greater.
(4) Stock-based compensation was included in the following operating expense line items of our consolidated statements of operations (in millions): Year Ended May 31, 2023 2022 Cloud services and license support $ 435 $ 205 Hardware 18 15 Services 137 67 Sales and marketing 611 448 Stock-based compensation, operating segments 1,201 735 Research and development 1,983 1,633 General and administrative 363 245 Total stock-based compensation $ 3,547 $ 2,613 (5) For fiscal 2023 and 2022, the applicable jurisdictional tax rates applied to our income before income taxes after excluding the tax effects of items within the table above such as for stock-based compensation, amortization of intangible assets, restructuring, and certain acquisition related and other items, and after excluding the net deferred tax effects associated with a previously recorded income tax benefit that resulted from a partial 44 Table of Contents Index to Financial Statements realignment of our legal entity structure resulted in an effective tax rate of 16.3%, instead of 6.8%, for fiscal 2023 and 16.3%, instead of 12.2%, for fiscal 2022, which in each case represented our effective tax rates as derived per our consolidated statement of operations.
Additional information regarding certain of our restructuring plans is provided in management’s discussion below under “Restructuring Expenses,” and in Note 8 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report. 46 Table of Contents Index to Financial Statements (4) Stock-based compensation was included in the following operating expense line items of our consolidated statements of operations (in millions): Year Ended May 31, 2024 2023 Cloud services and license support $ 525 $ 435 Hardware 23 18 Services 167 137 Sales and marketing 667 611 Stock-based compensation, operating segments 1,382 1,201 Research and development 2,225 1,983 General and administrative 367 363 Total stock-based compensation $ 3,974 $ 3,547 (5) For fiscal 2024 and 2023, the applicable jurisdictional tax rates applied to our income before income taxes after excluding the tax effects of items within the table above such as for stock-based compensation, amortization of intangible assets, restructuring, and certain acquisition related and other items, and after excluding the net deferred tax effects associated with a previously recorded income tax benefit that resulted from a partial realignment of our legal entity structure.
We calculate our current and deferred tax provision based on estimates and assumptions that could differ from the actual results reflected in income tax returns filed during the subsequent year.
We calculate our current and deferred tax provision based on estimates and assumptions that could differ from the actual results reflected in income tax returns filed during the subsequent year. Adjustments based on filed returns are generally recorded in the period when the global tax implications are known, which can materially impact our effective tax rate.
Historically, we have invested billions of dollars to acquire a number of complementary companies, products, services and technologies. We acquired certain companies and technologies during fiscal 2023 and 2022, including Cerner in fiscal 2023.
Acquisitions Our selective and active acquisition program is another important element of our corporate strategy. Historically, we have invested billions of dollars to acquire a number of complementary companies, products, services and technologies. We acquired certain companies and technologies during fiscal 2024 and 2023, including Cerner in fiscal 2023.
Payments from customers for these license support agreements are generally received near the beginning of the contracts’ terms, which are generally one year in length. Over the course of a fiscal year, we also have historically generated cash from the sales of new licenses, cloud services, hardware offerings and other services.
Customers for these license support and cloud services agreements are generally billed in advance of services being provided. Over the course of a fiscal year, we also generate cash from the sales of new licenses, hardware offerings and other services.
Liquidity and Capital Resources As of May 31, (Dollars in millions) 2023 Change 2022 Working capital $ (2,086 ) * $ 12,122 Cash, cash equivalents and marketable securities $ 10,187 -53% $ 21,902 * Not meaningful 51 Table of Contents Index to Financial Statements Working capital : The decrease in working capital as of May 31, 2023 in comparison to May 31, 2022 was primarily due to $27.8 billion net cash used for our acquisition of Cerner, $1.6 billion of repayment of senior notes assumed from our acquisition of Cerner, $3.5 billion of long-term senior notes that were reclassified to current liabilities, cash used for repurchases of our common stock, cash used to pay dividends to our stockholders and cash used for capital expenditures during fiscal 2023.
Liquidity and Capital Resources As of May 31, (Dollars in millions) 2024 Change 2023 Working capital $ (8,990 ) 331% $ (2,086 ) Cash, cash equivalents and marketable securities $ 10,661 5% $ 10,187 Working capital : The decrease in working capital as of May 31, 2024 in comparison to May 31, 2023 was primarily due to $10.0 billion of long-term senior notes that were reclassified to current liabilities, cash used to pay dividends to our stockholders, cash used for capital expenditures, cash used for purchases of non-marketable investments, net cash used for our employee stock programs and cash used for repurchases of our common stock during fiscal 2024.
For example, if an entity reporting in Euros had revenues of 1.0 million Euros from products sold on May 31, 2023 and 2022, our financial statements would reflect reported revenues of $1.08 million in fiscal 2023 (using 1.08 as the month-end average exchange rate for the period) and $1.07 million in fiscal 2022 (using 1.07 as the month-end average exchange rate for the period). 42 Table of Contents Index to Financial Statements The constant currency presentation, however, would translate the fiscal 2023 results using the fiscal 2022 exchange rate and indicate, in this example, no change in revenues during the period.
For example, if an entity reporting in Euros had revenues of 1.0 million Euros from products sold on May 31, 2024 and 2023, our financial statements would reflect reported revenues of $1.09 million in fiscal 2024 (using 1.09 as the applicable average exchange rate for the period) and $1.08 million in fiscal 2023 (using 1.08 as the applicable average exchange rate for the period).
Year Ended May 31, Percent Change (Dollars in millions) 2023 Actual Constant 2022 Research and development (1) $ 6,640 19% 21% $ 5,586 Stock-based compensation 1,983 21% 21% 1,633 Total expenses $ 8,623 19% 21% $ 7,219 % of Total Revenues 17% 17% (1) Excluding stock-based compensation On a constant currency basis, total research and development expenses increased in fiscal 2023 compared to fiscal 2022 primarily due to higher employee related expenses, including higher stock-based compensation and additional operating expenses due to our acquisition of Cerner.
Year Ended May 31, Percent Change (Dollars in millions) 2024 Actual Constant 2023 Research and development (1) $ 6,690 1% 1% $ 6,640 Stock-based compensation 2,225 12% 12% 1,983 Total expenses $ 8,915 3% 3% $ 8,623 % of Total Revenues 17% 17% (1) Excluding stock-based compensation 50 Table of Contents Index to Financial Statements On a constant currency basis, total research and development expenses increased in fiscal 2024 relative to fiscal 2023 primarily due to higher employee related expenses, including higher stock-based compensation expenses.
In constant currency, our hardware business’ total margin increased in fiscal 2023 compared to fiscal 2022 due to higher total revenues for this business. In constant currency, total margin as a percentage of revenues remained flat in fiscal 2023 relative to fiscal 2022.
In constant currency, our total operating margin and total operating margin as a percentage of revenues increased in fiscal 2024 relative to fiscal 2023 due to higher revenues.
Year Ended May 31, Percent Change (Dollars in millions) 2023 Actual Constant 2022 General and administrative (1) $ 1,216 13% 17% $ 1,072 Stock-based compensation 363 48% 48% 245 Total expenses $ 1,579 20% 23% $ 1,317 % of Total Revenues 3% 3% (1) Excluding stock-based compensation Excluding the effects of foreign currency rate fluctuations, total general and administrative expenses increased in fiscal 2023 relative to fiscal 2022 primarily due to additional operating expenses due to our acquisition of Cerner and higher stock-based compensation expenses.
Year Ended May 31, Percent Change (Dollars in millions) 2024 Actual Constant 2023 General and administrative (1) $ 1,181 -3% -3% $ 1,216 Stock-based compensation 367 1% 1% 363 Total expenses $ 1,548 -2% -2% $ 1,579 % of Total Revenues 3% 3% (1) Excluding stock-based compensation Excluding the effects of currency rate fluctuations, our total general and administrative expenses decreased in fiscal 2024 relative to fiscal 2023 primarily due to lower professional fees, partially offset by higher stock-based compensation expenses.
We believe that our current cash, cash equivalents and marketable securities balances, cash generated from operations, and our $6.0 billion, five-year revolving credit agreement will be sufficient to meet our working capital, 54 Table of Contents Index to Financial Statements capital expenditures and contractual obligations requirements.
We believe that our current cash, cash equivalents and marketable securities balances, cash generated from operations, and our borrowing arrangements will be sufficient to meet our working capital, capital expenditures and contractual obligations requirements.
Year Ended May 31, Percent Change (Dollars in millions) 2023 Actual Constant 2022 Developed technology $ 792 67% 67% $ 475 Cloud services and license support agreements and related relationships 1,507 155% 154% 592 Cloud license and on-premise license agreements and related relationships 459 * * 19 Other 824 * * 64 Total amortization of intangible assets $ 3,582 212% 212% $ 1,150 * Not meaningful Amortization of intangible assets increased in fiscal 2023 relative to fiscal 2022 due to additional amortization from intangible assets that we acquired in recent periods, primarily from our acquisition of Cerner, partially offset by a reduction in expenses associated with certain of our intangible assets that became fully amortized.
Year Ended May 31, Percent Change (Dollars in millions) 2024 Actual Constant 2023 Developed technology $ 676 -15% -15% $ 792 Cloud services and license support agreements and related relationships 1,026 -32% -32% 1,507 Cloud license and on-premise license agreements and related relationships 467 2% 2% 459 Other 841 2% 2% 824 Total amortization of intangible assets $ 3,010 -16% -16% $ 3,582 Amortization of intangible assets decreased in fiscal 2024 relative to fiscal 2023 due to a reduction in expenses associated with certain of our intangible assets that became fully amortized.
Year Ended May 31, Percent Change (Dollars in millions) 2023 Actual Constant 2022 Services Revenues : Americas $ 3,703 143% 143% $ 1,527 EMEA 1,246 19% 28% 1,046 Asia Pacific 645 2% 12% 632 Total revenues 5,594 75% 81% 3,205 Total Expenses (1) 4,490 77% 84% 2,539 Total Margin $ 1,104 66% 72% $ 666 Total Margin % 20% 21% % Revenues by Geography : Americas 66% 48% EMEA 22% 32% Asia Pacific 12% 20% (1) Excludes stock-based compensation and certain allocations.
Year Ended May 31, Percent Change (Dollars in millions) 2024 Actual Constant 2023 Services Revenues : Americas $ 3,432 -7% -8% $ 3,703 EMEA 1,338 7% 5% 1,246 Asia Pacific 661 2% 6% 645 Total revenues 5,431 -3% -3% 5,594 Total Expenses (1) 4,515 1% 0% 4,490 Total Margin $ 916 -17% -17% $ 1,104 Total Margin % 17% 20% % Revenues by Geography : Americas 63% 66% EMEA 25% 22% Asia Pacific 12% 12% (1) Excludes stock-based compensation and certain allocations.
Excluding the effects of foreign currency rate fluctuations, our total operating expenses increased in fiscal 2023 relative to fiscal 2022 primarily due to additional operating expenses as a result of our acquisition of Cerner, including higher intangible assets amortization; higher cloud services and license support expenses, which were primarily due to higher employee related expenses and infrastructure investments that were made to support the increase in our cloud and license business’ revenues; higher hardware expenses, which were primarily due to incremental hardware product costs related to Cerner’s hardware business; higher restructuring expenses; and higher expenses across other operating expense categories primarily due to higher employee related expenses.
Excluding the effects of foreign currency rate fluctuations, our total operating expenses increased in fiscal 2024 relative to fiscal 2023 due to higher cloud services and license support expenses, which were primarily due to higher infrastructure investments that were made to support the increase in our cloud services and license support revenues; higher research and development expenses, which were primarily due to higher employee related expenses; and higher acquisition related and other expenses, which were primarily due to certain asset impairment charges and certain litigation related charges.
Year Ended May 31, (Dollars in millions) 2023 Change 2022 Net cash provided by operating activities $ 17,165 80% $ 9,539 Net cash (used for) provided by investing activities $ (36,484 ) * $ 11,220 Net cash provided by (used for) financing activities $ 7,910 * $ (29,126 ) * Not meaningful Cash flows from operating activities : Our largest source of operating cash flows is cash collections from our customers following the purchase and renewal of their license support agreements.
Our cash and cash equivalents may be impacted by some or all of the aforementioned factors in future periods, the amounts and timing of which are variable. 53 Table of Contents Index to Financial Statements Year Ended May 31, (Dollars in millions) 2024 Change 2023 Net cash provided by operating activities $ 18,673 9% $ 17,165 Net cash used for investing activities $ (7,360 ) -80% $ (36,484 ) Net cash (used for) provided by financing activities $ (10,554 ) * $ 7,910 * Not meaningful Cash flows from operating activities : Our largest source of operating cash flows is cash collections from our customers following the purchase and renewal of their license support and cloud services agreements.
Total Revenues and Operating Expenses Year Ended May 31, Percent Change (Dollars in millions) 2023 Actual Constant 2022 Total Revenues by Geography : Americas $ 31,226 32% 32% $ 23,679 EMEA (1) 12,109 1% 8% 12,011 Asia Pacific 6,619 -2% 8% 6,750 Total revenues 49,954 18% 22% 42,440 Total Operating Expenses 36,861 17% 19% 31,514 Total Operating Margin $ 13,093 20% 28% $ 10,926 Total Operating Margin % 26% 26% % Revenues by Geography : Americas 63% 56% EMEA 24% 28% Asia Pacific 13% 16% Total Revenues by Business : Cloud and license $ 41,086 14% 18% $ 36,052 Hardware 3,274 3% 6% 3,183 Services 5,594 75% 81% 3,205 Total revenues $ 49,954 18% 22% $ 42,440 % Revenues by Business : Cloud and license 83% 85% Hardware 6% 7% Services 11% 8% (1) Comprised of Europe, the Middle East and Africa Excluding the effects of foreign currency rate fluctuations, our total revenues increased across our three businesses during fiscal 2023 relative to fiscal 2022 primarily due to revenue contributions from our acquisition of Cerner.
Total Revenues and Operating Expenses Year Ended May 31, Percent Change (Dollars in millions) 2024 Actual Constant 2023 Total Revenues by Geography : Americas $ 33,122 6% 6% $ 31,226 EMEA (1) 13,030 8% 5% 12,109 Asia Pacific 6,809 3% 6% 6,619 Total revenues 52,961 6% 6% 49,954 Total Operating Expenses 37,608 2% 2% 36,861 Total Operating Margin $ 15,353 17% 16% $ 13,093 Total Operating Margin % 29% 26% % Revenues by Geography : Americas 62% 63% EMEA 25% 24% Asia Pacific 13% 13% Total Revenues by Business : Cloud and license $ 44,464 8% 8% $ 41,086 Hardware 3,066 -6% -7% 3,274 Services 5,431 -3% -3% 5,594 Total revenues $ 52,961 6% 6% $ 49,954 % Revenues by Business : Cloud and license 84% 83% Hardware 6% 6% Services 10% 11% (1) Comprised of Europe, the Middle East and Africa Excluding the effects of foreign currency rate fluctuations, our total revenues increased in fiscal 2024 relative to fiscal 2023 due to growth in our cloud and license business’ revenues, which were partially offset by a decline in our hardware business’ and services business’ revenues.
While we use our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date as well as any contingent consideration, where applicable, our estimates are inherently uncertain and subject to refinement.
Business Combinations In accordance with the provisions of Accounting Standards Codification (ASC) 805, Business Combinations , we use our best estimates and assumptions, which are inherently uncertain and subject to refinement, to recognize and measure assets acquired and liabilities assumed, including intangible assets and pre-acquisition contingencies, at the acquisition date as well as any contingent consideration, where applicable.
We amortize our intangible assets over, and monitor the appropriateness of, the estimated useful lives of these assets. We also periodically review these intangible assets for potential impairment based upon relevant facts and circumstances. Refer to Note 6 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report for additional information regarding our intangible assets and related amortization.
Refer to Note 6 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report for additional information regarding our intangible assets and related amortization.
In addition, we believe that we could fund our future acquisitions, dividend payments and repurchases of common stock or debt with our internally available cash, cash equivalents and marketable securities, cash generated from operations, additional borrowings or from the issuance of additional securities.
In addition, we believe that we could fund our future acquisitions, dividend payments and repurchases of common stock or debt with our internally available cash, cash equivalents and marketable securities, cash generated from operations, additional borrowings or from the issuance of additional securities. 55 Table of Contents Index to Financial Statements Stock-Based Awards Our stock-based compensation program is a key component of the compensation package we provide to attract and retain certain of our talented employees and align their interests with the interests of existing stockholders.
Services Business Our services offerings are designed to help maximize the performance of customer investments in Oracle applications and infrastructure technologies and substantially include our consulting services and advanced customer services offerings.
In constant currency, total margin as a percentage of revenues increased in fiscal 2024 relative to fiscal 2023 due to lower total expenses for this business. Services Business Our services offerings are designed to help maximize the performance of customer investments in Oracle applications and infrastructure technologies and include our consulting services and advanced customer services offerings.
License support contracts are generally priced as a percentage of the net fees paid by the customer to purchase a cloud license and/or on-premise license; are generally billed in advance of the support services being performed; are generally renewed at the customer’s option; and are generally recognized as revenues ratably over the contractual period that the support services are provided, which is generally one year; and o cloud services revenues, which are earned by providing customers access to Oracle Cloud applications and infrastructure technologies via cloud-based deployment models that Oracle develops, provides unspecified updates and enhancements for, deploys, hosts, manages and supports and that customers access by entering into a subscription agreement with us for a stated period.
Revenue streams included in our cloud and license business are: • Cloud services and license support revenues, which include: o cloud services revenues, which are earned by providing customers access to Oracle Cloud applications and infrastructure technologies via cloud-based deployment models that Oracle develops, provides unspecified updates and enhancements for, deploys, hosts, manages and supports and that customers access by entering into a subscription agreement with us for a stated period.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeItem 7A. Quantitative and Qualitat ive Disclosures About Market Risk Equity Price Risk Marketable and Non-Marketable Equity Investments Our marketable and non-marketable equity securities investments totaled $972 million and $1.1 billion as of May 31, 2023 and 2022, respectively. Our marketable equity securities investments in publicly traded companies are recorded at fair value, which is subject to market price volatility.
Biggest changeItem 7A. Quantitative and Qualitat ive Disclosures About Market Risk Equity Price Risk Non-Marketable Equity and Convertible Debt Investments Our non-marketable equity and convertible debt investments totaled $2.0 billion and $1.6 billion as of May 31, 2024 and 2023, respectively.
Dollars and report in our consolidated financial statements for, and as of the end of, each reporting period. Foreign Currency Transaction Risk We transact business in various foreign currencies. Our foreign currency exposures primarily arise from various intercompany transactions. Our principal currency exposures include the Australian Dollar, Brazilian Real, Euro, Japanese Yen and Saudi Riyal.
Dollars and report in our consolidated financial statements for, and as of the end of, each reporting period. Foreign Currency Transaction Risk We transact business in various foreign currencies. Our foreign currency exposures primarily arise from various intercompany transactions. Our principal currency exposures include the Australian Dollar, Brazilian Real, Euro, Indian Rupee, Japanese Yen and Saudi Riyal.
We have established a program that primarily utilizes foreign currency forward contracts to offset the risks that arise from the aforementioned transactions.
We have established a program that primarily utilizes foreign currency forward contracts to partially offset the risks that arise from the aforementioned transactions.
Realized gains or losses with respect to our foreign currency exposures, net of gains or losses from our foreign currency forward contracts, and also costs incurred to enter into these foreign currency forward contracts are included in non-operating expenses or income, net in our consolidated financial statements.
Realized gains or losses with respect to our foreign currency exposures, net of gains or losses from our foreign currency forward contracts, including costs incurred to enter into these foreign currency forward contracts, are included in non-operating expenses or income, net in our consolidated financial statements.
Our non-marketable equity securities investments accounted for under the equity method, primarily in a related party entity, generally do not fluctuate based on market price changes. However, these equity method investments could be impaired if the carrying value exceeds the fair value and is not expected to recover.
Our non-marketable equity investments accounted for under the equity method, and convertible debt investments in privately owned companies, primarily in a related party entity, generally do not fluctuate based on market price changes. However, these investments could be impaired if the carrying value exceeds the fair value and is not expected to recover.
Refer to Note 1 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report for additional details about our foreign currency forward contracts. 56 Table of Contents Index to Financial Statements Sensitivity Analysis The following table sets forth the hypothetical potential losses that we consider to be the most material to the reported fair values and/or future earnings of our equity investments and foreign currency influenced holdings, prior to any income tax effects, resulting from hypothetical changes in relevant market rates as of or for the reporting periods below: Year Ended May 31, (in millions) Hypothetical Change Impact 2023 2022 Equity price risk: Marketable and non-marketable equity investments 25% decrease in market price and fair values Earnings $ (243 ) $ (277 ) Foreign currency risk: Total revenues 10% decrease in foreign exchange rates Earnings $ (2,037 ) $ (2,107 ) Cash, cash equivalents and trade receivables, net 10% decrease in foreign exchange rates Fair values $ (1,407 ) $ (1,131 ) Item 8.
Refer to Note 1 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report for additional details about our foreign currency forward contracts. 57 Table of Contents Index to Financial Statements Sensitivity Analysis The following table sets forth the hypothetical potential losses that we consider to be the most material to the reported fair values and/or future earnings of our foreign currency influenced holdings, prior to any income tax effects, resulting from hypothetical changes in relevant market rates as of or for the reporting periods below: Year Ended May 31, (in millions) Hypothetical Change Impact 2024 2023 Foreign currency risk: Total revenues 10% decrease in foreign exchange rates Earnings $ (2,259 ) $ (2,037 ) Cash, cash equivalents and trade receivables, net 10% decrease in foreign exchange rates Fair values $ (1,592 ) $ (1,407 ) Item 8.
Our non-marketable equity securities investments in private companies not accounted for under the equity method are adjusted to fair value for observable transactions for identical or similar investments of the same issuer or for impairment.
Our non-marketable equity investments in privately owned companies not accounted for 56 Table of Contents Index to Financial Statements under the equity method are adjusted to fair value for observable transactions for identical or similar investments of the same issuer or for impairment.
For additional disclosure regarding the impact to our quarterly results of operations from investment volatility, please refer to Item 1A Risk Factors included elsewhere in this Annual Report.
For additional disclosure regarding the impact to our quarterly results of operations from investment volatility, please refer to Item 1A Risk Factors included elsewhere in this Annual Report. For additional details on our non-marketable investments, see Note 1 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report.
The timing and amounts of changes in fair value of our marketable and non-marketable equity investments depends on factors beyond our control, including the perceived and actual performance of the companies in which we invest. Our non-marketable convertible debt investments would be subject to equity price risk in the future when the convertible option is exercised.
The timing and amounts of changes in fair values of our non-marketable equity investments depend on factors beyond our control, including the perceived and actual performance of the companies in which we invest.

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