TOKYO - Oracle Corporation (NYSE:ORCL) Japan has announced a significant investment to expand its cloud computing and artificial intelligence (AI) infrastructure in Japan. The company plans to invest over $8 billion in the next decade to grow its Oracle Cloud Infrastructure (OCI) footprint in the country. This move is aimed at meeting the increasing demand for cloud services and addressing Japan's digital sovereignty requirements.
The investment will bolster Oracle's public cloud regions in Tokyo and Osaka, as well as local operations teams for Oracle Alloy and OCI Dedicated Region. This expansion is designed to support Japanese governments and businesses in migrating their mission-critical workloads to the cloud while adhering to regulatory and sovereignty needs.
Toshimitsu Misawa, corporate executive officer and president of Oracle Corporation Japan, emphasized the commitment to support customers and partners in their cloud journey. He stated that enhancing the cloud footprint and providing a dedicated team for sovereign operations in Japan would allow for innovation with AI and other cloud services within the country's regulatory framework.
Oracle's OCI offers a distributed cloud model which includes a dedicated cloud allowing customers to run all OCI services in their data centers, hybrid cloud solutions delivering key services on-premises, and a public cloud serving various organizations including those with strict EU sovereignty controls. Additionally, Oracle provides multicloud options such as Oracle Database@Azure and Oracle Interconnect for Microsoft (NASDAQ:MSFT) Azure, enabling customers to leverage capabilities from multiple cloud providers.
The company's unique proposition is its capability to deliver AI and a full suite of over 100 cloud services locally through its sovereign cloud services. These services are designed to be securely delivered within a country's borders or an organization's premises, with a range of operational controls.
This strategic investment in Japan is part of Oracle's broader initiative to provide integrated suites of applications and secure, autonomous infrastructure through the Oracle Cloud. The company, listed on the New York Stock Exchange under the ticker NYSE:ORCL, continues to expand its global cloud infrastructure which currently includes 49 hyperscale public cloud regions.
InvestingPro Insights
Oracle Corporation (NYSE:ORCL) has been making headlines with its strategic investment in Japan's cloud infrastructure, aiming to capitalize on the growing demand for cloud and AI services. To understand the financial health and market position of Oracle, here are some insights drawn from InvestingPro:
InvestingPro Data shows that Oracle has a robust market capitalization of $326.03 billion, indicating its significant presence in the market. Additionally, the company's Price/Earnings (P/E) Ratio stands at 30.7, with a slight adjustment in the last twelve months as of Q3 2024 to 28.56. This suggests a premium valuation which investors are willing to pay for its earnings, possibly reflecting Oracle's strong brand and market position. The company's revenue has seen a healthy growth of 9.49% in the last twelve months as of Q3 2024, demonstrating its ability to increase sales and expand its business operations.
An InvestingPro Tip worth noting is that Oracle has raised its dividend for 10 consecutive years, showing a commitment to returning value to shareholders. This consistency in dividend payments, which has been maintained for 16 consecutive years, might be particularly attractive for income-focused investors. Moreover, analysts have predicted that the company will be profitable this year, which is corroborated by the fact that Oracle was profitable over the last twelve months.
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The strategic investment by Oracle in Japan's cloud infrastructure is a forward-looking move that aligns with the company's broader initiative to expand its global cloud footprint. The InvestingPro Insights provided here offer a glimpse into Oracle's financial metrics and market performance, which can help investors gauge the company's potential in the evolving cloud industry.
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