Oracle started as a database management company in the 1970s. For those who have been to their Redwood City offices (the headquarters moved to Austin, TX), you will remember the cylinder shape of the buildings inside their campus, which relates to the simplified depiction of a hard disk (database symbol).
With time, Oracle started adding products and functionality by buying Siebel Systems, Sun Microsystems, BEA Systems, Hyperion, PeopleSoft, NetSuite, and, more recently, the Cerner announcement. From its on-premise roots, the company has expanded offerings into the cloud with infrastructure (Oracle Cloud Infrastructure—OCI) and applications (Oracle Cloud Applications, Oracle Fusion Cloud, NetSuite).
From a hyperscaler perspective, Oracle is placed 4th by some research firms or 5th by others, after AWS ($80 billion in revenues), Azure ($50 billion), GCP ($17 billion), and Alibaba Cloud, depending on the criteria used. OCI is expected to have approximately $4 billion in revenues (8% of total revenue).
Oracle's revenues were $42 billion in fiscal 2022 and $50 billion in fiscal 2023 (~18% revenue growth, with 40% EBITDA margins). High-level revenue segments include DBMS (41%), ERP (12%), CRM (8%), App Infrastructure (8%), SCM (5%), Analytics (3%), Other (8%), Hardware (8%), and Services (8%).
To tackle the adoption of Oracle’s cloud infrastructure and application platforms, the company has a partner strategy that includes services and consulting organizations that help implement Oracle’s solutions. Let’s analyze the strength of Oracle’s services partner ecosystem.
As of Q2 2023, Oracle has approximately 330 worldwide service partners. We could not find information for 11 partners, so we crunched the data on 319. Oracle solutions are primarily used by enterprise customers, so these partners help implement each of the segments mentioned above. Relative to other services partner ecosystems we analyzed in the past, Oracle’s is quite balanced, with North America and Europe each with 27% of total partners and South America and Asia each with 18% of total partners.
These 319 service partners employ a total of 5 million professionals, with 80% of partners having a headcount of under 1,000 team members each.
Oracle also lists expertise per partner. 100% of the service partners have Cloud Service expertise, 71% have Cloud Sell expertise, 60% have License and hardware expertise, and only 8% have Cloud Build expertise.
At Alten Capital we focus on investing in business and technology services companies. We are interested in ISV partner ecosystems. Please reach out to us if you are a founder or management team member looking to scale your organization.