Oracle's Larry Ellison richer than Bill Gates as company reports higher profit

Microsoft founder pushed down to fifth on Bloomberg Billionaire Index

Texas-headquartered Oracle reported a net income of $3.3 billion in the last quarter. Bloomberg

Oracle founder Larry Ellison is now the world’s fourth-richest person — edging past Microsoft founder Bill Gates — as the company reported a more than 3 per cent annual increase in its 2023 fiscal fourth-quarter net profit.

Mr Ellison, 78, who stepped down as Oracle’s chief executive in 2014, has a net worth of $129.8 billion, according to the Bloomberg Billionaire Index.

This is the first time Mr Ellison has surpassed Mr Gates, whose net worth is currently $129.1 billion. This is also the first time Mr Ellison has been ranked higher than the fifth on the list.

Texas-headquartered Oracle reported a net income of $3.3 billion in three months to May 31, driven by a strong performance in its infrastructure business and cloud services division.

Total quarterly revenues surged 17 per cent year-on-year to $13.8 billion. Cloud services and licence support revenues jumped 23 per cent annually to $9.4 billion.

Oracle’s stock price surged almost 6 per cent to trade at $123.33 a share in pre-market trading on Tuesday. It has increased almost 40 per cent since the start of the year and the company’s market valuation stood at $314.34 billion as of Monday's market close.

The company’s net income for the full 2023 financial year rose 26.8 per cent to $8.5 billion. Its revenue increased 18 per cent to a record $50 billion in the 12-month period.

“Oracle’s revenue reached an all-time high of $50 billion in financial year 2023,” said Oracle chief executive Safra Catz.

“Annual revenue growth was led by our cloud applications and infrastructure businesses which grew at a combined rate of 50 per cent in constant currency."

The company’s infrastructure growth rate has been accelerating — with 63 per cent growth for the full year, and 77 per cent growth in the fourth quarter.

“Oracle’s Gen2 cloud has quickly become the number one choice for running generative AI [artificial intelligence] workloads,” said Mr Ellison.

“Why? Because Oracle has the highest performance, lowest cost GPU [graphics processing unit] cluster technology in the world.”

Oracle Gen 2 cloud infrastructure is a public cloud specifically for enterprise applications and databases. It includes tools and utilities for constructing new cloud-native and mobile apps, all on a unified platform, the company said.

“Cutting edge companies doing LLM [large language model] development … [and] other AI development companies have recently signed contracts to purchase more than $2 billion of capacity in Oracle’s Gen 2 Cloud,” Mr Ellison said.

The company’s operating cash flow stood at $17.2 billion during fiscal year 2023, up almost 80 per cent.

The board of directors also declared a quarterly cash dividend of $0.40 per share of outstanding common stock. This dividend will be paid to stockholders of record as of the close of business on July 12, with a payment date of July 26, Oracle said.