Please welcome to the stage Senior Vice President, Ken Bond.
Thank you, and welcome to Oracle Open World and our 2019 Financial Analyst Meeting. I've just got a couple of quick things to speak with you about, and then we'll bring Safra up on stage. Here it is. It's the one you all come for every year. You're going to see this slide repeated throughout today's presentation, just a couple of reminders about it.
First is that the information that we're presenting today is for information purposes only. Secondly, as that each presenter is sharing this slide with you, they won't be reading out the slide or anything like that. They'll be referring to this part of the presentation where I actually will read this out. So, statements in this presentation relating to Oracle's future plans, expectations, beliefs, intentions and prospects are forward looking statements and are subject to material risks and uncertainties. A detailed discussion of these factors and other risks that affect our business is contained in SEC's filings with Oracle, including our most recent report on Form 10 ks and 10 Q under the heading of Risk Factors.
These filings are available on the SEC's website or on the Oracle IR website. All information in this presentation is current as of September 19, 20 19, today, and Oracle undertakes no duty to update any statement in light of new information or future events. Thank you for that. So what we will be covering today, just in just a moment here, we'll bring Safra up on stage to have a little talk with you all, and she's got a surprise guest. Following that, Steve Miranda will come up and speak with you all about our applications portfolio and
an update there.
Subsequently, Juan Loeweza will come up and speak with you about Engineered Systems as well as Autonomous Database. And then Don Johnson will be coming up and talking about Oracle Cloud Infrastructure. We'll take a break shortly before 3 o'clock. And then at 3 o'clock Larry will come on up and we'll have a Q and A with Larry. So with that, let me bring up on stage CEO, Safra Katz.
Thank you. Thanks, Ken. Thank you and welcome. I'm thrilled you're all here today. I thought what I would do today is, first, I would take the opportunity to sum up everything we were showing and things that were happening at Oracle that if you were here during the week you would see and things you would from our customers.
I'm going to invite Doug Herring, Executive Vice President. He's going to talk to you about the Oracle at Oracle experience. It's something new. We did this year to share our own experiences with our customers who go the detail and then I'm going to come back up and take questions. To the extent that you don't get an opportunity to ask all your questions, I'll be here both before Larry speaks and afterwards to cover anything you've got.
I hope you got an opportunity to walk around Oracle Open World. Because if you did, you would have gotten the opportunity to see that we have been putting together all the pieces we need for our customers to be successful in the cloud. And what you would be coming out with off of that is a feeling of enthusiasm that we all very much have. I do even before I get started, I want to mention to you that we believe that this year we will have revenue acceleration over last year. I think in the rush to get our earnings announcement out on Wednesday instead of Thursday and to do that to announce Mark's leave absence at the same time as we did earnings, I have a feeling that that sentence might have dropped off my regular script.
So, I want to make sure you understand that right out of the box, okay? We think it's going to be a killer year. And now I'm going to tell you why. First of all, we are without a doubt the only company that can provide a fully integrated stack, which is something we've been known for in the on premise world. And now we can provide a secure performance and enterprise grade stack all the way from the infrastructure through the database with autonomous database to the applications and embedded AI in those applications and in the analytics.
It is absolutely true that other companies do customers you would have heard them say what many of them said to me. Gee, I was here 2 years ago. I wasn't here last year. It seems like a whole new oracle. It's not only how we look, but it is the fact that we have all the pieces and that we have references for our customers.
Most of the enterprise customers have been trying to do parts in the cloud, but many of them have been waiting for us to have some of the critical parts. First of all, let's spend a little bit of time on Autonomous Database. I know this is an area that I think there have been a lot of talk about the Oracle Database versus all sorts of open source pieces that are offered by other cloud providers or commercial software. Now, the reality is that the Oracle database is where all enterprises hold their most critical data. That has been true for decades.
And though some of them have tried to put a little here or a little there to try or to rewrite an application, we are talking about about 1,000,000,000,000, possibly 1,000,000,000,000 of dollars of investment in applications that can only operate at the performance and security level required for those enterprise applications, those can only be on Oracle. Historically and still today, Oracle has more market share in the database than all of our competitors combined. And why is that? Because the enterprise customers must secure massive amounts of data. They must secure it.
They must process it instantaneously. And that is only possible in the Oracle database. This is well known and this would also be a reasonable explanation for why Microsoft who's done a very nice job in the cloud with their applications, Excel, Office, PowerPoint, SQL Server and some of their infrastructure. Why is it they would want to partner up with us? Because they want to be able to have some of their products work with the databases, the database in our cloud.
And what is that? That's the Oracle Autonomous Database Service. And no one, no one is even trying to have a database that both self secures, self patches and keeps on running. And it's not only the database. I'm going to work my way down and then work my way up.
It's the underlying operating system with the Oracle Enterprise Linux, Oracle Autonomous Linux. This is the only Linux that is actually running in a cloud. This is a Linux that you can upgrade and patch and not take down. That's a capability. Again, these are the types of capabilities that enterprise customers demand.
That's what our target audience is. At Oracle, we do the hard stuff, okay? As I've told you before, sometimes jokingly, we don't focus on cat videos and I don't want to exclude dogs. We don't want to exclude we don't focus on dog videos. If you want to bring your cat and dog videos to our infrastructure, amounts of calculations that must not only be so fast they are instantaneous, but have to be right every time.
Our users cannot like some of you Netflix viewers all of a sudden be watching something and see that round circle start going in front of you. That's just not our be to be secure. I'm going to take a step lower. I'd like to talk a little bit and the team will talk much better than I could. But again, on why Oracle Cloud Infrastructure is completely unique.
It is absolutely true that we came to the infrastructure business after everyone else. So at first, we started with what I could only refer to as a me too infrastructure. But we've realized that was not good enough. And in fact, simultaneously Larry and the team and Don is actually going to talk with you, Clay, the entire team, they were working on the 2nd generation cloud, the next gen cloud. And this cloud is architected completely differently.
If you heard Larry's keynote on Monday night and I encourage you sometime when you're sitting eating lunch at your desk, flip on Larry's keynote and an architecture that is focused on security. You will see an architecture that is focused on performance. You will see an architecture that is focused on doing the hard stuff really fast. The architecture again, our network runs on a totally different processor than our customers' workload. Our customers' workload are often encapsulated entirely.
So they are not at risk of either nosy or noisy neighbors. This is the architecture that is absolutely critical for enterprise workloads and it is the architecture that our customers have been waiting for. They've literally been waiting for us. And what we see now and what you no doubt if you talk to customers, you saw this enthusiasm, they're not asking, gee, should I do this or that? They're actually thinking, when do I do it?
How do I do it? Come show me how to do this. How do I move to the cloud? Finally, a cloud that is ready for workloads. That's now.
On the application side, let's talk a little bit about that. I know Larry covered it yesterday and we will Steve I think is covering it here today. These applications, first of all, covered the underlying infrastructure and the database. These applications sit directly on that, okay? Built, integrated to work together.
I know those of you who have followed Oracle for a long time understand that this is a message and a capability that we have focused on frankly for decades. This makes it it no doubt they have their own custom applications they want to write or they want work have worked together with the applications. We provide a completely secure platform for them to extend. 1. 2, we provide the security infrastructure.
They inherit that. They build additional security by the way in the applications, but they don't have a vulnerability from the bottom up. And finally, those applications have embedded AI in them. Because they can handle enormous amounts of data. They can recognize patterns whether it's in approvals, in procurement, in expenses, in financial transactions of all sorts, journal entries, all sorts of things that can be of value.
But it's not only that they benefit from the platform and have embedded AI, but they are also the broadest, broadest. It's over 100 of capabilities that no single SaaS vendor can even put on the field. We have the entire ERP side of the business. We have all the parts including the most recent final addition, the supply chain pieces and process and discrete and hybrid processdiscreet manufacturing. No one has anything like this.
And we have the entire front office that is not only sales service, field service service but also the data necessary to better understand customers. All of it integrated built to work together. So it works together this way, works together that way. And then, above that and really built in analytics to give our customers insight. Now, say, well, I've been hearing challenge you to point to another company that has that.
And so it is absolutely true. We are now customers they started with something small and now are expanding. It is because of that that we believe we will see revenue acceleration this year and even more so next year. Because we are confident as our customers continue to deploy and ramp up usage of our products that we will see a market improvement in the business. And you'll see it, you'll look back on it, you'll remember today.
And by the way, and of course, double digit earnings growth goes without saying. I think I said it on the earnings call. I want to make sure there's no confusion. We expect that again this year. All right.
I've gone half my time. I'm going to ask at this point for Deb Kering to join. Don't feel I won't answer I won't answer questions. I can't wait to get your questions. I won't leave without answering them.
But let me introduce Deb Kering, Executive Vice President in his 20th year at Oracle been very centrally involved in the well in a lot of things, but also in shaping and creating the Oracle experience. Thanks, Deb.
Okay. Thank you, Safra. All right. I'll stay standing here. I think I've met a lot of you or at least if you've been to past analyst meetings, you may have heard my talk.
And that's because I'm dealing with all of Oracle behind the scenes and not on the technology front as much as you'll hear from all of our leaders later this afternoon, but on the business process side of things. How do we move our business to take advantage of the cloud? And we've really reached a critical point of no return at this stage. And I just wanted to give you a little bit of flavor on what that is and what a lot of our customers then saw as a result at OpenWorld this year. Just referring back to Ken Bond's Safe Harbor statement.
So to recap, what we're trying to do on the process side is this whole movement is really around moving from a product company to a service company. And as a result of this move, beyond just the technology front, it's been a complete transformation internally about how to actually achieve it. And a lot of what I work with all of the teams inside Oracle around is, what are the experiences we wanted to deliver for our customers, our employees, the audiences we're trying to serve in order to be effective in this new world. And that's really the driver behind all the transformation that we've done. No surprise because I know you guys are all familiar with these models around what the license model looked like versus what a subscription model looked like.
The reality is, for us, underlying this is it really forced us to change almost everything that was going on inside the company, relook at what we are doing and with a sense of urgency, get to the other side. The beautiful thing is we've had this wonderful platform around the cloud applications to help us enable it. So, we essentially partner between our line of businesses and the folks that are trying to change the processes to meet the needs of our customers in the service oriented world, along with the IT infrastructure that will enable us to do it. And I said we're sort of at that point of no return, where we are nearly 100% having moved all of our applications to the cloud across ERP, supply chain, HCM, CX, and EPM, it's all up and running inside Oracle. And it is the platform same question, which is, I understand I should move to the cloud, but why?
What are the benefits that I get? And having done it for us internally at Oracle, I boiled it down into kind of 4 basic areas that I articulate. The first is just around efficiency and effectiveness. We're no different internally at Oracle from any one of our customers relative to this idea that, in the old world, we had to buy data centers and buy servers and storage and build the entire stack of things that sat underneath the application in order to power whatever automation or business process we are trying to accomplish. All of a sudden now, we could go to the cloud operations team at Oracle and they can deploy us easily just like they deploy a net new customer.
And it's significantly less expensive for us on that front. It also allows us to free up money to go invest in more things. So, when we look at all of these transformational activities, we've got a ton of budget to enable us to go after new opportunities. The second is around just making smarter decisions. The cloud has enabled us to think differently.
As opposed to just being a transactional system, now we're thinking about being a decision making system. I'll give you a quick example of where that's already at work within Oracle. Employee expenses. One of the simplest things that all of us do on a daily basis. And yet, as a manager, for anyone that has to actually review expenses, is probably one of the most tedious and least liked activities in the world, mainly because your employee submits an expense and it gets sent to you as a manager and it's got all the things on there that they did.
Now, hopefully, you sent them wherever that person went, and they're doing work on your behalf, and you can validate that. But the rest of it, I had no idea what the business rules are within Oracle. I can't remember the hundreds of things around how much wine can I spend on if I have a customer or how much can I spend per employee if I'm at an employee meeting? Whatever it might be, all of these things are business rules that I have to remember. And yet, I'm presented with the entire haystack and said, find the needle.
Find what's wrong with this expense. And most people, they just hit approve. And so, all of a sudden, you've lost all the value. Now, with Cloud Expenses, it's the opposite, which is we actually send to the manager the expense report and says, We've reviewed the expense using the business rules and it's okay for you to approve. Or, We'd like to highlight the issues that are anomalies that you need to look further at.
So, again, making smarter decisions is number 2. 3rd is just outpacing change. The amount of effort we're going through in order to get ahead of our competition just like our customers is no different. We've got to continuously innovate internally around these processes. And the fact that we get these new releases every 90 days enable us to keep shifting and keep improving constantly.
And then the 4th is just around how do we delight our users. The idea of the old world where everyone just is satisfied that it's just good enough and enterprise apps or technologies are not that interesting, no longer exists because everyone has a consumer grade world. They're all using their iPhone. They all want a great experience. So I'll give you example again internally of how we're doing it differently.
We not only have moved relative to expenses, but we're actually now rolling out in Oracle a chatbot for expenses. So if I want to delight my employees, as opposed to having them go into the application when they're able to find a computer, go through the process of trying to scan in receipts, get them all loaded, attach them to the application, delineate what's on there, blah blah blah. Now, all they need to do is each time they get a receipt, they take a picture, the Oracle character the optical character recognition looks at it, breaks it down, says, Hey, is this what you want to submit? You say, Yes. You're done.
Never have to go into the application. You move on, you keep going about your business. Huge improvement as you think about how you delight users. That's only enabled by the cloud. So this has really been a culmination as a result of our entire move of all these processes to being service centric powered by the cloud, where we realized we're in a great position to share our story.
We've always believed that we should, at Oracle, use our own technologies. And obviously, we've done that throughout our history. But more than that, we want to be our number one reference. We want to be the best customer inside Oracle. We adopt first so that we can learn.
We can learn and we can help the development team continuously improve. But the reality is our customers are demanding to understand, hey, how do you do it well? How do you do it effectively? Give me some insight into how this works. And that led to the Oracle to Oracle experience, something we launched this year.
The mission of Oracle to Oracle is to educate not just external users like our customers, but also our internal audiences, both for awareness as well as to help arm our field about what the benefits are that can be achieved by leveraging the Oracle Cloud. We built a ton of content that we've now introduced in internal and external websites. You can go and find it at oracle.com/oracle@oracle. You'll see the stories. You'll understand what it is and you'll hear from our folks.
There's a bunch of, again, content we put together. It's not just about technical content. This is about business content. It's this idea that our Chief Accounting Officer gets on and explains how we are able to close the books in 11 days. What is it that that cloud can do?
And what do we have to change from an internal process standpoint in order to achieve those type of success? Because in every case where you're adopting these cloud applications, if as we tell customers that all you do is lift and shift, you take your on prem, you
pick it up and you put it
in the cloud, it's not going to you've lost a huge opportunity to improve your operations. So how can you improve your operations? It's all around those business processes. We've got videos from everyone inside the company around the executive team. Joyce Westerdahl, Head of HR, Evgen Goonair, Head of FP and A.
Everyone has put the time in to explain how we've done this at Oracle. That, as I mentioned, it culminated in the Oracle at Oracle experience at OpenWorld. It was over at Moscone West. It happened for 3 days. There were 4 theaters around It was wildly successful.
These are just a couple of pictures that I had taken of some of the sessions where customers came to sat in it. 30% of all of our badge scans for application attendees all came from the Oracle to Oracle experience. It was every one of the sessions was over attended and we realized that there's just a huge demand for people to get to know. And we also made it very informal. As you can see, there's couches, there's stools.
The idea is they can come and sit and listen and then afterward they can come talk to us and have an interactive dialogue. So they really, really learn as opposed to sit there and just try to listen to a talking head. This is a quick example of the financial supply chain on Tuesday. Again, we packed it in with stuff and put it in between all the keynotes. And then we tried to then explain to the attendees what type of things they can learn, whether that's how to reduce supply chain cycles from 1 week to 48 hours, how do we do a global single scalable chart of accounts, Things like that.
Again, it was real world business information that they could go and sink their teeth into, whether they were a CFO all the way down to a Director of Financial Planning. Same thing happened on the Human Resources. Again, how do you reimagine talent to a better hiring experience? All things that underlying was selling more Oracle Cloud, but on top of it was around getting access to our people. Finally, the Oracle experience is going to go on the road.
So, we've seen such success that we're going to now start taking this out to all the other events around Open World in other parts of the world and the modern business experience. So, I think you'll see more and more of this. And we found that it's a very powerful selling adjunct that our field can leverage and customers can get access to us. Thank you.
Awesome. And we've got Luis and Eva will
be running around. If you
have a question, please just raise your hand and wait for the microphone to come to you. Who would like to go first? Here we go. Carl?
Hi, Karl Keirstead of Deutsche Bank. Safra, thank you for the week. I did roam around a little bit. And I wanted to ask you something that I noticed that actually wasn't really about Oracle Technology, but rather the branding where I felt it was very different this year at OpenWorld. It was toned down and subdued almost, words that I frankly wouldn't normally use with Oracle, where even the logo was just an O.
It wasn't red everywhere. And I'm wondering, there must be a method to that. And I'd love to hear a perspective because maybe it hints at more of a cultural change. Thank you.
Yes. Well, there's a few things. First of all, we feel that natural colors and seriously natural colors sort of are much more approachable because the reality is we have to move from just a product company to a service company. And when you're a service company, you have to have a much more approachable feel to you. And so we've really internalized that in every way.
Our own move to the cloud meant so let's just talk about a few things that are very different. We had to move to the cloud because in our old business, we would sell you a license and you would implement it and maybe you wouldn't even implement it with Oracle Consulting. You would implement it with someone. And then once in a while, you would inquire if you needed support either online or by phone or in some way. In the cloud, we have to serve you.
And to do that, we have to be much more approachable. We have to really partner. And our own move to the cloud though by the way also meant that the number of transactions and the continuous serving of you means the volumes in our system went way up. So, we had to bring in a larger self-service autonomous or automatic or automated approach to everything we did. I could never have a back office big enough to handle 10 to 100 times volumes and still touch every transaction.
So we had to reengineer reengineer all our processes as Doug was talking about, so that many, many of them were done automatically, but that we also kept a personalized feel to it. And so we decided this was we fade to some extent into the background of all of our customers. Instead of overwhelming them with our branding, we are subsumed as part of theirs. And that's really our whole feel. It's much more natural, much more modern, hopefully appealing to not only appealing to an older demographic, but also appealing to a younger environmentally sensitive demographic.
So that's what we did. And we thought this was the year to do it because we got all the parts. Thank you for noticing.
Hey, Sabra Kashlum with Bank of America. How are you?
Hi. Red
is okay, I guess.
I love this, but red is okay.
Yes. I like red too. It's kind of orangey.
Yes, exactly.
I'm color blind, so don't take me
off.
You're in red. Just letting you know. It's not blue.
With you taking on more responsibilities, how are you approaching your job differently because you're taking on functions that are pretty massive? I know it's probably been addressed on the conference call, but just wanted to in this forum hear you out. What are you going to be doing differently? And also, are you planning to bring on a CFO?
Okay, sure. I'll cover all this. So I think many of you who actually do know how we operate at Oracle, Larry, Mark and I are a team. We work on a lot of things together. And that's really known.
I myself never want to work on anything alone. I have a well known saying why should I suffer alone. So I'm always dragging Larry and Mark into everything. And we are all very interspersed into each other's. Larry's development meetings, Mark and I are nearly always there.
In the sales organization, even though Mark runs the sales organization, salespeople don't get the entire design of their comp plans and the whole structure of the sales force. All of that if you think that's done without Larry's or even my input, you would be wrong. It has always been done as a team. The reality is that it is a very, very big organization. Luckily, we have a lot of very talented folks.
I'm not considering taking on a CFO CFO because the CFO office is the way we've worked now for quite a long time. My tax person is way better in tax than any CFO could ever be. My Chief Accounting Officer is better at accounting my Head of HR, of course, they're specialists. And we operate as a group together. And frankly right now, though I remain the Principal Financial Officer, the bulk of the work is of course done and directed by real professionals.
And the same in FP and A. All the groups, I don't need to list them all. All of the groups are run by people who are much better than any CFO could ever be and they work together beautifully. As far as how Larry and I are handling the work with Mark on leave, As I said, plenty of folks, very senior folks in the organization are helping us. But of course, Mark's shoes are very, very hard to fill in the interim.
So we will we're doing our best. I'm spending a lot more time with customers and the field. Larry is spending a lot more time with the support organization. And we continue to move into this DevOps model for the cloud and it's what we believe. So it's actually a good fit for us.
I think I answered the whole question. Thanks.
Hey, Brian Melenchy from Barclays.
I walked the floor as well and Don will probably talk about it in more detail later about Gen 2. But can you talk about where you are with your application portfolio and moving that over to Gen 2? And then the question then comes, what does it do to your gross margins?
Yes. So I want to talk about this. So and this also, by the way, covers any questions you might have about CapEx, right? Because just so that you understand what we've been dealing with sort of within the envelope of our capital expenditure and gross margin envelope, let me explain what's been going on. 1st of all, we've had the GBUs which are our global business units.
They've been on all sorts of different underlying infrastructures. Okay? So I've had to deal with all these different cloud situations. Okay? I just want to tell you where it's been.
Actually a whole bunch has already moved to OCI. The SaaS underlying infrastructure was its own cloud. It had its own structure. Okay? We had OCI Gen 1 which is OCIC and we had a number of database services and middleware services on that.
There's a third one. And now, we have OCI Gen 2. Okay. Getting rid of all of those. Everybody moves to 1.
Think how much cheaper that is to operate. Okay? We're closing all these at a record rate or sometimes we're redeploying it. We're taking the square footage. We're putting OCI there.
And of course, we're expanding out OCI globally. So what happens? That means that our SaaS infrastructure, which as you know has incredible gross margins already, Now allows us to actually get scale for OCI. And so one, I mean this is not a complicated concept. We all know.
1, way cheaper than I would like to have referred to it as 4, but it wasn't 4 because many of the GBUs and the acquired entities were on all sorts of combos. So everything's moving on OCI, some faster than other. All new staff stuff is going on OCI and we're moving as quickly as possible the older stuff. There are some certifications we've needed for different requirements and we are rushing to those. We've gotten a number of the government ones.
They're either we got them or they're already we've built it out. We've done it. We're just waiting for some of the paperwork. And so we've got, I think, Clay will probably know or PCI compliance, all of these different requirements. This is going to make both my capital spending much more performant.
And it's just better and easier and I have massive economies of scale. I will admit though that some of our rollouts are going a little bit quicker than we thought. We just we have not officially launched our India data center and we failed it. So we had to very quickly send more kit into it, which is what you call a win win proposition. I do think we will be fine in our $2,200,000,000 CapEx and we'll be within there because I'm going to be able to not make any more investments and all that other stuff.
So I hope I've covered it. I tried to also cover additional questions while I was at it. I know there I got 5 more. Whoever wants to go, you're in charge. Go.
Hi. It's Kirk Materne with Evercore. Hi. Hi, Sefra. Partner commentary, I thought, around the ERP product set this week was particularly upbeat and partners making, I think, pretty big commitments in terms of their own growth around your product set.
ERP has been slower than CRM or HR in terms of moving to the cloud for sure. Sure.
I was
just kind of curious, why do you see that? Why is that inflection application side of the equation. Is the base starting to move because of where the products
are? Thanks. Yes. So let me tell you what I have always believed and maybe I'm right, maybe I'm wrong. But until our customers saw that we had moved everything, A whole bunch of them were just kind of like waiting.
Because it's one thing to move HR. It's one thing to move your front office. But you and me, we know the most conservative group is the finance operations. These are the folks that file quarterly filings. We all sign them and they are not necessarily the ones loving change.
How do you build confidence with those? Well, first of all, a number of them did not want to move in our base until they had a good supply chain. If they're going to move, remember if you're an e business suite user, the operative word is suite. Okay? We sold you last time on having the whole thing work together.
You covered around on the edges. But the big thing, they wanted to see others do it and they want to know that we had done it. We have done it. We implemented supply chain. Okay.
Now they're good to go. Little by little, our base is moving. They're very excited about moving. At any one moment, there are 100, 100 of simultaneous moves by our partners. They're just talking to a couple of our partners that I actually happened to introduce their speaker.
They had 4 100 of our clients moving simultaneously. So 800 together nearly 1,000. And this momentum builds because and then once they're on the other side, I was sitting at Modern Finance Experience, which is a lunch. I was at the lunch at this table, a few e business suite users moving because they realize it's time. And so that and ERP for us is growing 30 something percent and that's just Fusion ERP.
Obviously, NetSuite continues to grow. Those are smaller companies. This is and as ERP gets bigger, this is causing rapid acceleration in the apps world. We do have some negatives in our SaaS number by the way, which we called out before, which is when Facebook and Google some of the big platforms didn't want to permit data as a service from anybody but themselves. That's had a negative on our numbers.
That's going to become irrelevant very soon because just of the size will be dwarfed by the growth in ERP. And by the way, we're finally on deck with a front office offering which of course we have a competitor with salesforce.com. But I will tell you that what they don't have is 2 things. One is they don't have the other pieces that anyone doing a complete front office would need including product life cycle management, a full configure price quote that then connects to into a manufacturing suite and they don't have a full platform. So that's starting that's going to be a much longer haul.
So but little by little we have an excellent management team that's really put together a message and we've got a bunch of customers starting there. But that's a longer term job. The big thing that's pushing our SaaS numbers, obviously the growth in ERP.
Excellent. Mark Murdler, Bernstein. You talked about how you're now live on your own on your own
Supply chain, yes.
And the whole business and that you'll be able to accelerate the great of being able to close the books. What does that do and now you're automating all that. What does that do for the underlying cost structure of the Oracle business, especially you accelerate the revenue growth?
So first of all, had we not done it understand, I don't know how I could have afforded to run the operation with such massive volume increases. It simply would not have been manageable. So first of all, it's avoided growth in costs. Secondly, it's released resources to be able because even though I can't remember the exact percentage, very, very high percentage of our transaction by volume are what I think what we call touchless. Is that the lingo we use?
Touchless, no touch, something like that. Okay. So that means nobody touches it. However, there are transactions that are somehow require special teams to work on those. A, I couldn't have afforded to have teams work on those.
So now we can have people focus on the complicated, the weird, the unique, the lots of moving parts, something that's not regular without raising my cost structure. Now, as revenue accelerates, this has happened to us before by the way. If you think way, way back in our original first transformation when Larry took over operations of Oracle when I first came in 1999, you know what happened. We started growing and our expenses didn't go up. And that is how we ended up with the massive increases in our margin.
Our back office as a percentage of our overall business already is a very small spend compared to other companies. But now as it accelerates, we expect that this will give us additional value. Additionally though, we redeployed some of those resources in completely different areas and ultimately get even some savings back to that. Okay. So let me make a deal with you guys.
We're on a schedule here. So I'm going to let the other folks do their talking and then I will come up and take more questions afterwards, if that's okay. Are we good with that plan? Excellent. Thank you.
Who's next?
We put over 700,000 people to work, so we've just got some beautiful stories. We're all here to deliver shareholder value and run a good company and make the difference in the lives of people that we all work with, many of which are on tough times. They've lost a job. Maybe they've lost a spouse, and this might be a new job for them. Sometimes it's a second job.
You can count all the numbers, but as you hear the stories of individuals, that makes it much more real.
So what makes TrueBlue unique is our ability to bring more talent, better quality talent to our customers. Some of the technology that we were using prior to moving on with Oracle was a number of different financial systems Lawson, Adaptive, BlackLine, Workday for our HCM. And as we were going through the search, it was really important to us to have a system where HR and finance were both talking to one another. Merging 2 databases into 1 meant that we had less effort being put into managing those databases. During the budgeting process, able to better plan for what we need because we can see both the strategic side and the financial side.
What I really hope to achieve with these two systems talking together is that we help the company grow and we're able to look at workforce analytics as one way to do that, so that we're making smarter decisions with the team that we have, the team that we need.
We cut a 3 days off the close cycle, cut another 3 days off of all of this analysis. All of a sudden, we're a week faster. We're already seeing the benefits of that. We want our people focused on, well, how can we run our branches better? How can we deliver our services faster?
And with some of the technologies that we're rolling out, this makes it much more convenient for them, much more friction comes out of the cycle, and that's creating more quality time
of interactions from a human perspective. That kind of at the right time, the right place, right people, that's really what success is, that the company is able to operate and achieve its goals and talent enabled it.
Please welcome to the stage Executive Vice President, Steve Miranda.
Thank you.
Do I have
to leave this up for a set period of time? No? Can I call it the Miranda rights next year for
okay? All
right. Let me go into so my name is Steve Miranda. I'm going to cover try to get some color on a few key differentiated points in our application. So, I'm got to cover the completeness of the suite. I'll cover the advantage that we have from the technology of the suite.
And I'll give you a little bit of flavor of the customers that are updating to our SaaS applications. So, first, we talk about the benefit of having a complete suite of SaaS applications and both parts of that commentary is critical, complete and SaaS. Why is that the case? So, when we talk about complete, it's financials, it's core HR, it's supply chain data. Now, let me try to give you examples of why they're both all of that is critical.
This is a sampling of new feature functions we've added since last year. And there's a couple of key aspects of it. First, the SaaS component. So, we update every single one of our customers over 19,000 pods quarterly. Every quarter, every one of those applications average a little bit over 100 features that we add to it.
And a very, very simple test to figure out whether a company is a SaaS application or a hosted cloud application is a pretty simple set of questions. Just ask them how many code lines do they have and are all their customers on the same exact code line. With all the customers I'm going to show you, one single code line all on the same exact code line. The second question is how often do they update those customers. At Oracle, SaaS applications, we update all the customers 4 times a year, all to the identical function.
Why is that important? Without doing that speed and that cadence, we can't add as much feature functions to each and every application. Without doing that speed and cadence to every single one of the customers, it is on
what
on what we do. So, frankly, having been at Oracle for a little over 2 decades, if we were put in a competitive situation, trying to do our older model, the E Business Suite, which we've worked on for a while and I'm proud of working on that, there's just no way we could compete. Updates of 1, 2, 5, 7, 10 years, You cannot add the feature functions, you can't learn from the feature functions, you can't compete against a rapid delivery model or stay up to date with technology. Now, you'll notice that we add a lot, but we say about a complete suite. What have we added?
Well, the vast, vast, vast majority of our customer base can update to the cloud today. You'll see us add things like we added Vocado in Financials for student financial aid planning, extending to a smaller market for higher education and student planning. We added labor distribution for specific parts of higher ed and public sector. We had a joint venture accounting for oil and gas, very specific capabilities going forward. The vast majority of our customer base wouldn't mean use these things.
We're now at the outer edges. In supply chain, we've added process manufacturing to our discrete manufacturing. We added project manufacturing. And we added one key feature, which I'll highlight, which also tips to the benefit of the suite. It's called services supply chain.
And what is services supply chain? Basically, can you call up for service and schedule that service person to arrive at the right time? So, let's take a pretty simple example. You have an issue, you need a repair, you need to have that scheduling, which you need field service and field service scheduling. We have that in our suite.
You need an HR might schedule may need to have a particular skill set to do that repair. So not only you have to put the person at the right place at the right time, you need to make sure the right person is there. But in addition to that, you need a supply chain and inventory application because if you have a repair part that needs to be done, you better make sure you have the part and you need transportation planning because that part better be at the right place at the right time with that person with the right skill. And, oh, by the way, if you happen to manufacture the spare parts yourself, you may actually need to manufacture that part, which may in fact have lead time, which may require you to buy raw materials to produce that activity. So when we say a simple new feature, it shows it showcases the power of the suite.
You need a service application, field service scheduling, core inventory, HR and manufacturing to enable that feature, and we believe we're unique in enabling this in SaaS. Investments in CX, we added a brand new application called CX Unity, which really is not only a blending of the CX properties of sales, service and marketing, but also blending our data. So the general idea is can you get a central view of your customer, not only based on what you know about the customer, but also the data that's happening in the real world about that customer and use that information in your engagement with the customer, whether it's sales, service or marketing. So, my analogy is quite simple on this. In the old world of just using the information you know, it's a little bit like automating a So, you take a map and now you have a phone and you have an online phone and they could tell you now online how to get from place A to place B.
That's just the information you know. But today's world, you have information that's happening real time and that's out there and available. So, of course, when you have a map now, you don't just use the directional, traffic patterns, changing traffic patterns, road closures, detours, and you have that same thing. CX Unity is not just a 360 degree view of the customer, it's your 360 degree view combined with external data, combined with machine learning, which helps you dictate how to best engage with the customer. So those are just a few samples of the completeness of the suite and the speed of adding to the suite.
In addition to that, not only do we have the Fusion applications, but we continue to make great progress in our NetSuite application along the same themes that you've been hearing. So, since combined with Oracle, we've added a host of countries for NetSuite for our middle market or smaller customers. Those include 30 plus countries, including China, France, Germany, India, Japan, Mexico, Singapore and the U. K. NetSuite has also added a host of verticals and they've added that to accelerate their existing Suite success, getting 50 new Suite success industries across the NetSuite platform.
They, much like Fusion applications, have 100 plus updates or 100 plus features to the core modules in each and every quarterly update that they do. And by the nature of the global nature of Oracle, they've leveraged that and now have over 3,500 partners to help grow their infrastructure across the board for NetSuite. So, just a sample on the NetSuite side, similar benefits, similar scale, similar completeness of Suite, so that whether you're a large customer or a smaller organization, you can run a complete SaaS application from Oracle. So, now let me move on to the technology base. And we feel we have a significant advantage over every one of our application competitors because of our investment in the technology and because, frankly, from my team's component, a lot of it we get automatically.
And I'll just cover 2 samples. Sometimes our customers will see parts of the technology that actually surface and improve the way the applications look and feel and are used. Other times, the applications, they won't even see it. So, a lot of what Clay and Don are going to talk about, a lot of what Andy and Juana talked about, things like security, things like scale, things like network reliability. As we are in the Oracle SaaS application suite, we inherit all the benefit of the Gen 2 infrastructure and our customers just see it, it's more secure, it's faster, it's more reliable, automatic hearing all the benefits of all that engineering effort that we put into the cloud.
Now, let me get into a few more specifics. And what I'm going to highlight here is machine learning. So, we leverage the underlying tech stack underlying investment in machine learning to add machine learning features across the board. This takes a flavor of recommendations within the applications or in fact a brand new UI called digital assistants or bots, if you will, across the board. So every single area, whether it's sales, marketing, supply chain, financials and HR, we're applying data, which I spoke of before.
We're applying the technology of machine learning. We're issuing a recommendation through the application. We're measuring that for accuracy and then we're improving that machine learning and recommendation. So one example in the HR space, we have machine learning around best candidate matching. So what we do is basically take attributes of the candidate, again, not only your internal information, but external information like LinkedIn and attributes.
We compare that against people in your own organization who have those same attributes and skills in that position and people who have succeeded in that position. And then we use machine learning to recommend who to interview, who to hire or go forward. But then we measure that in the applications. And by measuring that, we determine whether that algorithm was good or bad and we fine tune it and improve it by day by day going forward. So again, when I talked about before being SaaS and that speed of innovation, that speed of turning with machine learning, in particular, really impossible to do without measurement and speed of constant improvement that the SaaS application provides.
And you'll see this just in different samples. In field service, we've done over 600,000,000 recommended routes for our Toa applications. In our e commerce, we've made 50 +1000000 product recommendations and e mail campaigns. We've done 4,000,000 plus recommendations for next best actions and sales. And literally off of every one of those bullet points I showed in the previous slide, we're getting better and better and better as the numbers go up.
The machine learning validates and goes forward. So, those are one example of things you see from technology. What our customers may not see directly is the value of Oracle SaaS applications moving to the Autonomous Database. And all the things that you hear about the Autonomous Database basically make it easier for us to manage and develop the SaaS applications. It makes us better since it's easier to develop, we go faster in the development.
Since it's self driving, even in a SaaS application, though our customers don't have DBAs, Oracle has DBAs. But now much of the functions that they perform go away and are completely automated. What does that result in for our customer? More reliability, faster performance and by nature of lower overall cost for Oracle to operate it on their behalf allows us to go even faster and give more investment on their behalf to further improve our application products, not just spend the dollars keeping their systems up and running through the SaaS system. So all of I picked up 2 examples, but the entirety of the stack investment, I get asked sometimes in competitive deals what our development investment is in HR, for example.
I really have no way of answering that because the HR investment is way more than our HR development team because we inherit all of the infrastructure which none of our competitors do. Next, let me get into customers. Let me get some add to some customers. But I just want to add to what Doug and Safar have already covered with the Oracle story. We work a lot on it and we're pretty proud of it.
And we have a great team that use the application. But let me just give you guys some color when we say we run it at Oracle. It will be pretty obvious, but I like saying it anyway. So, we are roughly $39,000,000,000 plus organization. We run all of our financials.
We are 130 plus employees around the globe. We run all of our HR. We are also a professional service organization through Oracle Consulting, a reasonably large professional service organization. We run our project management and project accounting through Oracle. We are a manufacturing business.
Actually, we are sort of 2 manufacturing business. We have our engineered to order Exadata systems, but we also have more commodity systems through our micros business for the point of sale. We run all of those through our manufacturing system. We have tens of thousands of salespeople within the organization. We run all our sales, forecasting, lead management, marketing all through the same system.
So when we talk about running Oracle at Oracle, and I think one of you who asked during the last earnings call about the earnings speed, all of that we run-in our cloud all in one instance, all on the same version that all of our customers get, all in the same data center, same security, all with those 4 times a year update, that's what we use to run Oracle. So we have a slight advantage because we run our own software. Let me tell you, it's very slight. We have to run that entire business. And I think that serves as a proof point for what our cloud applications can do.
But now it also gives me the benefit of positive on this slide. We're just extremely proud of the it's really a who's who of logos of customers who've converted to the cloud. And the best way I can try to simplify it is we had a pretty hard matrix to go to customers to show them comparisons or references, if you will, because we had to show customers who migrated from financials, you had to show customers migrated from HR, you had to show customers who migrated from CRM. But in addition to that, because of our installed base, we have large customers, multinationals, domestic and smaller customers. You have customers who came from an SAP background, a PeopleSoft background, a JD Edwards background and an EBS background.
And you have customers across many industries. And as you look at this slide, that's basically what's represented here. It's that cross matrix of a different starting point, a different size organization, some public sector, some commercial, all have migrated to our financials. And then what you'll start to see is when I flip forward to HR, you see some repeats. Hearst is one example.
They spoke on my keynote. They did a great job. I'd advise you to listen to their story. They started live off a variety of legacy systems, non Oracle mostly, to the Oracle Cloud and Financials. Subsequent to Financials, they added HR.
Subsequent to HR, they added payroll. After payroll, they added talent management for reviews and appraisals. And now they've added learning. You have AXA. AXA started in Asia for their HR application, talent management, added core HR, marched around the globe, Asia, Europe, now they have it globally.
You have Cummins used to run HR from EVS. You have others you had YRC Worldwide Freight who used to run PeopleSoft HR. And then I gave you some examples who run non Oracle systems as well. We have it now in CRM. And in CRM, I'll call out 2 in particular, Veritas and Symantec.
Though they run Oracle EBS, largely on the back end, those are salesforce.comreplacements. So, going directly from salesforce.com to Oracle SaaS Suite in Salesforce Automation, not just in marketing, not just in service, but in the core of what Salesforce's strength is. In the case of Veritas, they had extended the application, not just core salesforce.com, but extended the application with over 9,000 either third party or custom extensions to the salesforce.com platform using force.com, all migrated to these Oracle SaaS applications. So, hopefully, I gave you a flavor of the big differentiators we can see in SaaS. 1st, the most complete suite and going faster than anybody in the SaaS application to extend to that suite.
2nd, we get a tremendous leverage in technology, things you see like machine learning and digital assistants or bots and things you don't see, infrastructure updates, reliability, security going forward. The notion of technical debt in the Oracle Cloud has basically disappeared because we sit on top of that investment that we have going forward. And 3rd, and what some of you probably saw at this conference and commented about, we now have reference customers live achieving business value across all those dimensions I talked about, finance, supply chain, HR, CX, but also Siebel background, PeopleSoft background, EBS background, JD Edric background, SAP background and other 3rd party backgrounds applications. With that, I hope it's Ken. Thank you.
Please welcome to the stage Executive Vice President, Juan Luiza.
Okay. So I'm going to go through what we're doing in the database world. So we have our safe harbor that Ken showed you earlier. So for database, we have a very simple strategy. We've been doing database for a very long time.
So we have a very simple strategy. The best database on the best database platform, have the best database cloud and give customers the way they want it. So that's it. Those are the 4 things that we're doing. So I'm going to go through this very quickly one at a time.
So best database, we've been in the database market for a very long time. And we have a reputation we've earned for mission critical database technology. So, we continue all that. There's 2 things we're focusing on lately in database. 1 is bring all the latest cutting edge technology into our database.
So, at this open, we talked about a lot of stuff like, for example, native multi tenant technology in the database, native and memory technology in the database, native IoT technology in the database, documents, hyperscale, 2 kind of new cool things. For the first time at this open world, we talked about bringing blockchain technology directly into the Oracle. Somebody looked up. Blockchain, yes. Financial guys kind of like blockchain.
So we're bringing blockchain technology directly into the Oracle database. We've also brought machine learning technology directly into the Oracle database and a lot of data lake technology directly into Oracle database. So, all the cutting edge technology most of this is already out. And there's a few things that will be coming out next year. So, all the cutting edge technology in the Oracle database and make it a seamless experience with everything that's already out there.
So that's our other big part of the database strategy, something we're calling converged database. So, like on a smartphone, it's not just a phone, you have all sorts of other stuff. You have music, you have Internet, you have maps, you have everything in the world. Same thing with the database. We're bringing all this technology into one database and that has a ton of advantages, simplicity advantages, availability, performance.
One of the ones that I like to call out is, you get synergy. Like on the phone, it's a music device and it's an internet device. So, it's 2 things. But you also get synergy. So suddenly you can do streaming music, which you could never do before when these things were separate.
So it's not just, hey, we're cramming it all into one thing. They actually play together. They help each other. So we can run analytics on unstructured data. We can run mission critical OLTP with blockchain technology.
We can run blockchain with unstructured data and structured data. So it's not just putting them together, you also get a lot of synergy. Okay. So that's best database. I'm not going to spend
a lot of time on that.
Okay? 2nd, best database platform. So by the way, we have the best database platform. So we just say that. Now, best database platform.
So how do we run the database? This is something we put a lot of work into. And we have our engineered system, specifically Exadata, it's been in the market for about 10 years, extraordinarily successful. We have most of the largest companies in the world running on Exadata now very successfully across all sorts of workloads, everything from super mission critical to giant data warehouses to the most complex applications in the world, a lot of consolidation. When we first came out with Exadata, the biggest users were actually telecoms.
Now the biggest users are you guys, the financial companies. So practically every big bank in the world is heavily invested in Exadata. There's a very few number of large banks that have not bought Exadata. I just talked to 1 2 hours ago who is about to go big into Exadata. So it's very successful.
Why? Because it's super mission critical, super fast, super available, great price performance. So all those things put together runs all the different workloads, very flexible. So let just say a little bit about what we're doing on this front. So at this open world, we announced a new version of Exadata.
And this kind of takes it to the next level. So there's a couple of different things here. I'm not going to go into a lot of detail, but we are using a latest cutting edge, what's called RDMA network inside our Exadata platform. So we've moved to a new 2.5x faster network. More interestingly, we're using what's called persistent memory.
Those of you that cover tech know that this is a brand new semiconductor technology that just came out. It's from Intel. We've been working with them for 5 years to get this working and get it to market. And we're getting tremendous performance from that. We get about 10 times faster transaction processing latency, 10 times, not 10%, 10 times.
And that's a big deal. And we do that because we've integrated our database software and our Exadata through all the way to the persistent memory in a very unique way that nobody else can do. So this is something that we've announced and we started shipping immediately. I can tell you I've talked to a lot of customers at OpenWorld. And if you go talk to people go talk to your own people, this has our customer base very excited, 10 times latency benefit, doesn't come around very often.
It's kind of a sea change in the technology world. Okay. Best database platform, most proven and the latest and greatest technology. All right. So let's move on to best database cloud, 3rd part of the strategy.
You probably heard that we have this thing called Oracle Autonomous Database. So that's our strategy for the best database cloud. Now, it's very simple at some level. It's all about automating, self provisioning, self scaling, all that kind of stuff. It's really more than that because the simple way to think about autonomous data is kind of like a self driving car, right?
Everything is automated. It does it all. You don't have to have all these people doing it for you. But as usually happens when there is a technology change like this, that's kind of the most straightforward benefit. But there is more that comes with it.
So, for example, when people talk about self driving cars, you're like, hey, I no longer have to drive, that's nice. But that's not the only thing like, hey, you can just send your car to pick up your kid at the soccer game. That's nice. But you get ideas flowing around. Hey, I can have my car that's running around making money for me while I'm at work by driving other people around.
So, technology changes actually create bigger opportunities. And it's the same thing with Autonomous Database. It's self driving, but the other big benefits are the whole security. Security is a giant pain point for companies. Securing database is very difficult.
So we take on that thing and we do a much better job of securing the data than practically every single customer in the world is doing. The scaling, so it used to be things were very static, systems were very static. With our autonomous database, it expands and contracts dynamically. So it brings in a whole generation of better scaling, better cost performance than ever existed before. The availability, much better.
Some of the machine learning technology, much better. So it's not just the self driving part. Like I said, when you have a big technology change, it's not there's the straightforward part like, hey, I get 2 things on my phone, but then the synergies come together and you get a much bigger hole than just the sum of the parts. So we've been production with Autonomous Database for a little over a year. We these numbers are taken straight from our Q4 report.
We have 1,000 now paying customers, many trials. We just launched our free autonomous database trial. So that's something Larry talked about Monday. We, in the last couple of days, have gotten thousands of sign ups for free autonomous database. So it's really kind of starting to pick up speed, pick up momentum.
Okay. I want to point out a couple of things. When we talk about autonomous database, we say the word database, but it's really the whole stack. So traditionally customers built their whole thing, they bought servers, storage, network, OS, backup, all that stuff. They put it together themselves.
When a customer gets an autonomous data from us, they get the whole stack. So that increases our addressable market quite substantially. It's one thing. 2nd, again, autonomous service is self driving, that's nice. Oracle has not been known to be the easiest to use database in the world.
That hasn't been our reputation. It's been known as the most mission critical database in the world. Now, actually, we're the simplest to use database in the world. That opens up new markets. So people like developers were scared to use Oracle before.
Smaller businesses were scared to use Oracle before. Lines of businesses within companies were scared to use Oracle before. Data scientists, so these guys out there with their they're trying to do all this machine learning data science, were scared to use Oracle. Why? Because it's kind of complicated to use Oracle.
Now with autonomous database, we're literally the simplest database in the world. So what used to be our biggest weakness, we've completely flipped it. We are the easiest database to use in the world. It opens up whole new addressable market, whole new range of users that can get it. And that's what we're seeing with a lot of our autonomous database adoption.
Okay. So I'm going to flip through a couple of slides on some of the things that we're seeing. So we're seeing a lot of Oracle, again, traditionally, you think of it, the large company is the Fortune 500. We address the Fortune 500. We're also getting, without Thomas to say this in particular, a lot of small midsized companies, the bulk of the companies.
Now most companies in the world are not part of the Fortune 500. It turns out there's only 500 of those. But over 90% of our users for Autonomous Database, early users, are small companies. So it's growing that market. The market that wasn't traditionally Oracle's market, there were other people that were strong in that market.
We're going to grow very fast in that market. Developers, again, I talked about this. About a quarter of the uses are developers. Again, developers were kind of scared of Oracle. Now it's super easy to use Oracle.
New workloads versus migrations. So there's a ton of new workloads. So when you look at our Autonomous Database, a little less than half are brand new workloads. And the other half is workloads that existed that people are migrating onto Autonomous Database. So a lot of new workloads it's bringing in.
Industry, so this is actually kind of interesting. So there's generally early adopters and late adopters, okay? And what we usually see is things like professional services and technology. Those are the early adopters. Tech companies, they like cool new stuff.
Professional services, they like cool new stuff. Who doesn't generally like cool new stuff? Actually, public sector is not normally an early adopter. So I actually just saw this chart last week and I'm like, wow, that's interesting. Why?
Because if you're in the public sector, you have you struggle with getting talented IT, right? And so when we provide an autonomous database, suddenly they're like, hey, this enables me to do things I couldn't do before because I couldn't get the talent in my public sector to do the kind of mission critical database technology. And actually, the one here that's interesting is financial. Because again, financial is not normally an early adopter. They usually kind of hang back a little bit.
But it's interesting, the number one highest adopting for autonomous databases, financial sector. Now that one, I don't have as easy an explanation for. Like public sector is kind of a no brainer. But financial is an interesting one. Okay.
So we came out with Autonomous Database about a year ago. And we first started with Autonomous Data Warehouse, which is aimed at things like data marts, analytics, then we came out with Autonomous Transaction Processing. So these are both in production for
a little over a
year. Initially, most of the customers were autonomous data warehouse. In the Q1, we had it out. But as you can see, transaction processing is growing over time. Now, data warehouse analytics, obviously, lower risk, right?
If your analytics system is down or you have a problem, the company doesn't shut down. So as we bring in transaction processing, that's higher risk. So they're going to be a little bit behind. But it's growing very nicely. And again, it grows the addressable market.
I'm not going to go through all this stuff. I do have a customer that's going to come talk to you about their experience. So we have a lot of customers, very, very happy and you've seen some of this stuff. I'll talk briefly about this. When we first came out with Autonomous Database, we came out with something called Serverless Autonomous Database.
We just last month, about a month ago, introduced in production something called Dedicated. So the idea of serverless, very simple, very elastic. Dedicated is a more large IT. So serverless, super elastic, super simple. It's meant for customers that don't want to know or care about database.
So line of business, data centers, they don't want to know are we on patch 12,146 or 12,014, 57. They don't know, they don't care. They just you guys deal with it. You guys do all your best practices. That's what Servile.
So it's aimed at labs, departments, SMBs, developers, that kind of people. About a month ago, we released what's called dedicated. That's much more targeted at the enterprise and at people like CIOs, CTOs, architects, people that want a level of control, people that say, hey, I want to make sure any new software that comes into this goes into my test system before it goes into my production system. I want to make sure that nobody messes with anything near my quarter close. So they want to define some policies.
They want to have a level of our appeal to large enterprises, in particular, our appeal to large enterprises, in particular, the IT department. So we're addressing both the people that hate IT and the people that are IT. Okay. So that's database cloud. Your way is very simple.
Again, we have we offer our autonomous database or our database technology both on premises in the public cloud and in something we call Cloud to Customer. We've now released our 2nd generation of Cloud to Customer. And what it basically means, it's pretty simple. Take our public cloud technology, deploy it in the customer's database data center. We have hundreds of customers running this.
It's very popular. Okay. And the last step, really kind of the last step to complete the whole picture is bring our autonomous database to CloudCustomer. So today, we have autonomous database in the public cloud. We brought our cloud technology into the data center.
The very last step, which we will complete next year is bring the autonomous database technology into customers' data centers. So that's coming. Okay. So that's it. This is this has a lot of appeal.
What CIOs want, they want to modernize the cloud in a safe fashion, knowing that it's going to work, that they're not going to have a problem. They need to modernize everything. Just taking a few new applications, putting them in the cloud isn't going to move the needle. They want to secure the enterprise, innovate more, spend less. We address all these pain points directly.
So that's why this is so appealing to our customers. Okay. Now what I want to do is bring up Craig Wilenski. He is the CEO of a SaaS company called Jassy Software. And he is going to tell us a little bit about his use of Autonomous Database because he has gone all in on Autonomous Database.
I have.
So thanks, Greg, for joining us. Maybe start by telling us a little bit about your company.
Sure. So, Jassy is a SaaS software application for logistics. So we drive e commerce operations, retail, consumer goods at the warehouse level, inventory level. So we're the ones facilitating that. I know there's a lot of different definitions of SaaS.
So we're a SaaS multi tenant system. So one logical system that controls all the customers. So it's a big task. It's some of the reasons why I'm here today.
Right. And when he means warehouse, you don't mean data warehouse. No, no. I mean moving Real warehouse.
You order something over the Internet, magically shows up at your door, I'm controlling that inventory. I'm controlling all the labor, robotics, everything in real time. Right.
And so tell us what some of the challenges were and why you decided to look at our autonomous database technology? Well, we work with very database technology?
Well, we work with varied customers, anything from small, medium and very large. And we're one logical system. We realized as we were on boarding customers and sizable ones that our main limitation was going to be the database. So we're born in the cloud system. It's and I look at it at 3 layers.
So we're the SaaS application and I look at the cloud as the platform as a service and I look at the database as a database as a service. So we were looking for a partner that would give us that capability to scale our application. We really had 3 really 4 things we were looking at. Our customers really want speed. I mean, if I take a second or more to do stuff at the warehouse level, with all the labor and robotics, they may have to double their workforce.
They will not hit service levels or anything like that. So speed was really paramount. Second thing was reliability. As you're running people's supply chains, that's their company. That's the heart of their company.
So reliability, they want 7x24 uptime. They want 100% availability all the time. The other thing they wanted was security. I mean, I'm housing all their corporate data. I mean, I'm housing all their customers, what they shipped, all their products, pricing, everything within the platform.
So security was also paramount. And the last thing was the ability to scale. So they may have back to school, they may have Cyber Monday, they may have Black Friday, it may be Chinese Singles Day, 11:11 and there's the scale just goes tremendously large. So we needed a partner and a platform that was really going to size with us and really allow us to grow with our customer base.
What's the scale of a very large customer for you?
We just got selected by one that does 100,000,000 orders a year. These are large scale customers. The average one you have customers ranging from doing 2,000 orders a day to 100,000 orders a day on e commerce. And there's a lot of focus on e commerce today because people aren't building out new facilities for store fulfillment, But they will transform those and that will be part of the formula as well. But these generate billions of transactions in a day.
You look at it as I just ordered one thing or I ordered 2 things, you don't even realize the amount of transactions that does on our side. We're a machine learning platform. So our system is a little bit different than what was traditionally out there. So we developed a system that actually makes decisions in real time. So we don't really the data just flying so fast.
These systems, even though we had software in the past, people would manually mine data and decide what they were going to do, and that's no longer feasible. So our customers are competing with tech giants. I think you know who they are. They don't have the wherewithal and the software capability to compete with them. So we built the platform really to level the playing field.
All right, great. So your experience?
It's been great for us. So I'll go through we were one of the early adopters. The reason why we were one of the early adopters is I saw that I wouldn't be able to grow my company or handle my customers' requirements unless I had a platform like this. Secondly, we didn't want to be in the database business. We wanted the benefits of a database, but we didn't want to be database experts, if you will.
Yes, we do know databases and we work with them continuously, but it's not our job to maintain platforms. We're building vertical software for them. So we were the only adopters in the platform, so we learned a lot about it. And we've grown with this platform. So the venture for us took we started about 9 months ago on this venture.
And now we're just onboarding customers. I'm going live this weekend with 1aauto.com, a big automotive parts on the web, a massive site, hundreds of people in a distribution center and they go live this weekend and I'm not worried about it. So, as we did this venture, the whole part was to have a centralized database that scales, auto scales, because as our customers grow where they have their peak periods, we didn't want to be having to hit a button or have someone sitting there and go, Oh, ramp it up, ramp it back down. Also for 3 things. 1 is the storage.
We may need storage on demand. We may need memory on demand and compute power on demand. So as we started the I know Larry had a lot of points that he talked about in the keynote. You I know Larry had a lot of points that he talked about in the keynote. We're all nervous about it when you first do it.
So Larry had all these key points, but it's actually true. I mean, we are doing the things he was talking about today in live production. So our database, we want the autonomous database in the cloud, the one way you manage. So I say it's on them. So all the patches, all the security updates, everything they're doing to keep me up full time.
I don't know how they do it, but you have like automatic mirrored systems. And then every 2 weeks they're patching and they're doing the things they need to do and they switch. And that switch is in like milliseconds when that happens. And we even worked around some things, even those milliseconds, we need we're pounding transactions. So we added some things in our code to be more resilient knowing that that happens, but it happens in milliseconds.
My customers are still up and running. I'm not worried about it. I don't have to be a security expert. I don't have to have people that are dedicated to it. And even if I hired people, I'm nervous about what they would do.
There's manual errors that could happen. And I did have that happen on our prior database, where they were indexing while customers were live and they deleted a table that was primary in the system. And it took us weeks to recover, customers went down and that's really when I made the call. All right.
All right. Great. Well, thanks, Greg. Thanks for
your experience.
Thanks for listening.
Please welcome to the stage Executive Vice President, Don Johnson.
Hey, everyone. Thank you. My most professional looking slide is Ken's. It never gets old. Well, I have a little bit of technical content to cover, but strangely Safra already covered it.
And she did it really well. But little known fact, she is co CTO at Oracle. So, I want to talk mostly about the business of Oracle Cloud Infrastructure. So SAPRA covered how we're an integrated business in the cloud of applications and infrastructure. So really, I think the way to think about that is just it aligns directly with our traditional business of applications and data.
And this is a direct extrapolation from our traditional on premise license software business. Our customers trust us for the biggest, hardest, most gnarly and mission critical applications and the underlying data. That's what our business looks like. Shocker, that's what our business looks like in the Cloud. It's what our business looks like overall.
I really draw the Gen 2 cloud bucket around the entire business. They're 2 halves of a whole. They're not really inter they're not separate businesses. That's a long way to think about it. But even in the Cloud Infrastructure business, what does our business look like?
It looks like apps. It looks like data. So, breaking out the box a little bit, I'm going to talk very quickly about some of the underlying and surrounding aspects of security, infrastructure, developer tools and horizontal integrations with partners that we've done. So, quick gauge of progress and growth, an easy metric is where we have regions and how many regions we have. So, this is a little bit of history.
This is us a year ago. Actually, I am talking only about our Gen 2 infrastructure. So, this is the new OCI, our Gen 2 infrastructure. I'm not talking about any of the stuff that as Safra said, we are ruthlessly getting off of and going and killing and scrapping it for parts and not paying for anymore. So, Genzhou infrastructure, if you go back 3 years, that's when we launched it.
It had bare metal computers in one region. It was interesting, but not actually useful for a lot of customers. Fast forward 12 months to 2 years ago, we were in 3 regions. We have a lot more features. It was much more interesting to many more customers.
Fast forward 12 months from then, get to this picture. We had 4 regions, a lot more features it was very, very interesting to a broad set of customers. Sometime in there, say over the last 18, 20 months, we achieved what the startup kids call product market fit. We had a good product. It did real things for real customers, solved real problems that are not addressed elsewhere.
They came, they used it, they were happy and they grew. And if we took it away, they would be sad. So, at this point, we had like in the scheme of nail and scale it, we knew it was time to scale it. And we could look at the basic metrics of health and it told us and reinforced that view that we actually had the right platform and that it was time to grow it and get big as quickly as possible. Largely what we look at is we look at usage.
We look at new customers, new workloads, but really everything in the cloud world is defined by usage. You need happy successful customers and those customers look like ones who actually use it And they grow when they're using it. So, what happened? So, that was 12 months ago. This is right now.
So, between then and now, we added 12 regions. For those doing the math, that's about a region per month. And candidly, a lot of these actually came in just in the last 3 or 4 months, in particular the ones in other continents in Asia and in South America. Interesting phenomenon is that in the new places where we launched, say in Japan and Korea and in India, as Safra indicated, they're actually growing much, much faster out the gate than our older the places where we've been for more time. That's a function of the maturity of the platform, the fact we have references, the fact that we have more knowledge in the market about our offering.
And also the fact that we've kind of got our stuff together when it comes to the go to market. We actually pipeline the stuff and we're able to grow it. So, let's extrapolate forward on this picture. Larry showed this slide on Monday. So, I've rounded up to the end of 2020.
So, this is maybe 15 calendar months. We're adding 20 more regions. We're going to be at 36 regions. So, we are going global as soon as we can and we're just we're growing like wildfire around the world. So, you will say, wow, that's a lot of regions.
Can you actually do that? Yes, we can. Why can we do that? Because we automated to be able to do that. This is one of the second mover advantages.
If you set your mind on doing something, you can do the right engineering and make it possible, both to build them and to operate them. A couple of interesting points. So, first, why are we doing this? Why are we doing this big global push? Why are we doing it now?
As I said, we have the right product and we need to we are in fact playing catch up in the infrastructure space. We need to get to market where our customers are and go to them. This is the beginning of what we see as a trend. If I project forward in the future when Cloud is a $1,000,000,000,000 business, which it will be, my belief is easily half of that is going to be local. All of the big workloads are going to be governed by data jurisdiction, data sovereignty.
They're going to need to be served in country. And all of these are very material big workloads. And if something bad happens, you need to recover. So, all of them require disaster recovery. You'll note on the previous slide, we had a lot of duplicate regions amongst the 36.
We will have 11 geographies, 11 regions where we have in country Doctor. This is our basic philosophy. This is what an enterprise platform needs to do to meet people where they're at. You have to go in typically you have to go in with 2 and you have to be there. We think that this is honestly, this is what the extrapolation of cloud for enterprise around the world is going to look like.
And we basically tooled for it. So, this is a thing that we're very agile at and that we're able to do. As Steve and Saffer noted, SaaS is fully integrated onto our Gen 2 infrastructure. This means if you launch Fusion Apps in North America if you're a Fusion Apps customer, a new Fusion Apps customer in North America or Europe today, you launch an OCI, all of those regions that I just described at launch, out the gate are going to have Fusion Apps and NetSuite included in them. And the map that I didn't show you was the map of all the data centers that we're in the process of killing.
It's honestly like a giant cleanse that we're doing corporate wide. And I couldn't be happier about just like the end state simplicity and the speed at which we're getting there. So, fully integrated. An interesting side effect of our ability to build this many regions so quickly is that, well, we've made it fairly modular and we have T shirt sizes, we can go super big and extra large and down to small. We'll get to extra small.
But this gives us the ability actually to build things that are commercially viable for what we call dedicated OCI regions, which are just like the other OCI regions, but for one customer. Who would be interested in this? Well, say a nation state that wants the ability to kind of fund geographical ability geographical availability in their region or say a very large footprint, very large customer that's regulated that the regulation say they can't go to a multi tenant public cloud. They may have a very large on premise footprint that they don't plan on moving and requires very low latency say like a millisecond or 2 from any workloads that they want to move to the cloud. This might look like, say, a stock exchange or a telco or a government agency or a military or a big bank.
This is a thing that we have and that we're going to push. And what I'm saying in a coded fashion is my personal belief is when we tell you we're going to have 36 regions, we're actually going to have more, but we can't tell you about them. Go. So, who uses our cloud? Where have we seen growth?
Like I said, there is a trope here. There is apps and there is data. 70% of what we see is running on Oracle Tech and it is enterprise lift and shift. And maybe 50% of them are running on Oracle Database. This is a mix across plain old database, autonomous and Exadata.
There is actually a ton of Exadata. Why are they coming? Safra said they couldn't go anywhere else. They've been waiting for us. We're here now.
Maybe 20% is Oracle applications, big ERP systems, packaged apps, E Business Suite, JD Edwards. This is the customers who are not yet moving to SaaS. We believe eventually everybody is going to move to SaaS. SaaS eats the world, but this is complex and it can take a long time. So, we see a lot of this stuff come across in all of it, surprisingly, runs on Oracle database, runs on Exadata.
Those two things have a very similar outline and shape. So, non surprisingly, we designed a cloud to be good at this. We're good at this. This is where much of our business comes in. Slightly different, 25% of what we see on OCI are actually workloads that don't look anything like the first two things other than that they are big and they run well on the same infrastructure.
So, they're really taking advantage. This is sort of I wouldn't say accidental advantage, but it is the advantage of the way in which we built our infrastructure. It is very good at what I call infrastructure intensive applications, infrastructure workloads. This includes HPC, think computational fluid dynamics. We built out a clustered network, have high clock HPC systems.
We have the latest and greatest GPUs. There are things that run-in this environment that can't run elsewhere in the cloud. Honestly, in HPC, we're not really competing with other cloud vendors. We're competing with on prem and the trade offs between just buying a whole spending $100,000,000 on computers or running this in the cloud. This infrastructure intensive bucket also includes just like big iron workloads, a variety of kinds, a bunch of AI, ML, data intensive.
It also includes big SaaS providers that are looking for either bare metal security or bare metal performance and they're very price performance sensitive. I have some interesting examples that may surprise you in this category.
I'm going to go through
these very quickly. Let's look at some of our customers and some of our workloads. So Cisco is one of the SaaS providers, Cisco Tetration. They're a security SaaS provider. They are a security company.
So, they're very, very it's a security business. They're very, very security sensitive. They require bare metal for physical isolation and they need the price performance that it provides them, they run on bare metal. FireEye, similar but different, security SaaS provider, they run on bare metal, big workload, very price performance sensitive. Booster Fuel is a innovative start up that will like drive fuel to your car.
It's very modern, not based on Oracle Tech in general. And it's a containers Kubernetes MySQL workload. CERN, they discovered the Higgs Boson. That's cool. They're also a giant user of OCI and they have a very modern workload.
Siemens, they built a new IoT SaaS business. It runs on Oracle DB. State of Texas, this is actually my favorite one of these examples. This is a big ERP system, a general ledger system. This was my favorite deployment because it was the most boring deployment ever.
I got like 500 e mails the weekend before. It's like nervous Nelly hand wringing stuff like, oh my God, everybody's all hands on deck. It went great. Nothing happened. It simply just launched.
It coincided with the day of launch on a Monday. Some dude in Texas IT decided that was the right time to do a scale test of their system. And all of a sudden, they got like way more simultaneous users. Everything went great. There was not a blip.
Like $92,000,000,000 of money runs through the system. I would also say, I speculate there is easily thousands of things across the United States that look just like that. The fact that I'm showing this slide means reference. 7.11, big database workload, big ERP system, big ERP system, big ERP system, big ERP system. So, you get the point.
We set out to be good at the cloud that excels and unlocks moving big enterprise workloads, big ERP systems, big Oracle DB application workloads, which is a trapped, latent, unsatisfied market, they're coming over. It's a lot of what we see. I'm going to go so Safra already covered my security talking points. I'm going to fast forward through my ASIMO build the stack slides to the end slide and just kind of land a simple concrete point. So, security is a complex topic.
We talk about it a lot. At the end of the day, I think the point here is actually very, very simple. To be secure, you need to be automated. Not only do you need to be automated, it needs to cover everything. You are as strong as your weakest link.
Not only does it need to be automated and pervasive, very frequently needs to be mandatory. You're giving bazookas to children if you just give them a pile of tools and let them manage it themselves. You need to do this for them and with them. You need to keep them safe. So, behind just the technology and what we've done here, there's also a philosophy and a point of view.
So, we have taken a comprehensive stack based approach. We provided at the foundational level things you only get at the foundation level. You either do or don't have somebody else on your box with physical isolation. You do or don't need to trust somebody not to pick your memory and look at your data registers. Autonomous Linux, like this sounds like magic.
I'm a client of that. Ed Skrevensteen delivered it. We run our cloud on that. Larry had an anecdote, which is true fact, a year ago, Inspector meltdown, we had to go do like millions of patches in OCI. We did them around the globe in 4 hours, completely automated, didn't reboot a system, not a blip, nothing went down, nobody noticed.
It's magic technology. Bringing this to customers is revolutionary. Autonomous DB, everybody knows and loves it. It is revolutionary. The other stuff, I won't go into a lot of detail, but say, maximum security zone.
What is this in simplicity? This is a place where we have maximum security by default and it is mandatory. And we've done this. Basically, we're taking the concepts of highly secure systems, compartmentalized information systems, hierarchical security systems, like you see the Intel folks do or like you see in high security OSs and doing a data center level scale for all of your stuff. For instance, we'll insist everything is encrypted, has all of the right permissions, there's mandatory access controls, has the right network architecture.
So, for instance, this would be a place where we would not let you say, take all of your confidential customer IP, put it in an unencrypted file, stick it in object storage, fat finger the wrong ACL and fat finger the wrong, say, WAF system in front of it. We wouldn't let you do that. We are protecting you. Behind that, apart from just the technical capability is the philosophy. We think this is our job.
So, there's 2 points. Customers can't do this on their own. They can't build stuff like this. They couldn't deploy it if we gave it to them also like it's fundamentally a cloud system. This is not only what they demand from the cloud, this is a big part of the reason why they're going to the cloud.
So, these are our expectations. For enterprise customers, this is what they want in the cloud. The other observation is, what can the other vendors what do they do? Do they do something like this? Well, in principle, I think in technical capabilities they can.
They have got lots of smart people, but they don't. Fundamentally, what they have done to date is they have given you a complicated set of tools like, here you go. Here is a side arm and a chocolate bar, jump out of the plane. And it's very enabling, but it's frightening. And in some sense, it makes it worse.
It gives you more complexity, more options. Oh, this is different than the other place. Now all of a sudden, you've introduced a ton of risk into your system. So, we have not only a stack that we think others aren't going to match up to anytime soon, but they don't even seem to want to or believe that it's their job. So, Safra also covered my infrastructure slides.
What makes our actual infrastructure in Gen2 Cloud do the things that I've said that it does? It's actually very, very simple. All of the workloads that I described, say, talking about the lift and shift enterprise mission critical big workloads, They require a big performance envelope. They require a lot of resources. They require a lot of stability.
They're very, very cost sensitive. So what do we do? We give them a lot of resources. We have the best performance. Our pricing methodology is charged less than the other guys.
Big performance, low price, excellent price performance makes it cost effective. We give different resources than others have that are not available elsewhere. We give you exit data for niche workloads like HPC. We give you a clustered network in HPC systems that you can't get anywhere. We literally have stuff that others don't.
And we give you very reliable systems and we stand behind them. So, we have SLAs. This is basically a table stakes requirement. If you want to get like the state of Texas moving a BRP system and you tell them like, sometimes stuff will go down, it's okay. No.
They need to have an SLA. And we have categorically better and broader and more pervasive SLAs than any other vendor. Not only data plane availability like the other guys have, but control plane availability, the APIs that use to provision systems, we guarantee that they're going to be available. So, if you're in a recovery event, you can call the API and get more stuff. And we guarantee the performance.
These things are really table stakes for meeting the enterprise requirements for moving workloads over. Also, we actually, in the way in which we have designed and delivered the infrastructure and this is where it gets kind of techie and esoteric and I'm not going to go super deep in it. We have truly elastic infrastructure in a way that I think is fundamentally novel in the industry. For instance, we give the ability in compute to specify how many cores you want, how much memory you want. In storage, how much storage you want, how much performance you want.
But that can look a little bit like the provisioning systems in other clouds, but we give it to you dynamically and we let you change it on the fly. So, for instance, you could put, say, a data store on top of block storage. And if 29 days of the month you have little demand and then one day of the month you have this much demand, you can simply just add more performance at the end of the month and slide it back down. Why does this matter? I'm going to fast forward through to blah, blah, blah, tastes great, less filling, costs less.
Look, if you run an AWS, 90% of your money gets spent on computers, storage, database. And then, 10% on the really cool kids little stuff. The things that dominate your bill are the traditional infrastructure. Part of the reason it dominates your bill is you don't really get all the benefits of elasticity. You can scale out and get more computers, but you can't really adjust the size of a computer.
And so, people end up over provisioning and underutilizing. The elasticity I just described lets you actually right size your stuff and gives you the advantages that the cloud promises of true elasticity, pay only for what you use for traditional workloads. So, you don't need to be bored in the Cloud. You could say move a pokey old ERP system on top, rightsize your stuff if you got it wrong, upsize it. You can optimize your cost.
So, partnerships, we had a couple of big partner announcements crap, I'm running long. Couple of big partner announcements in the recent past, Microsoft and VMware. Now that Larry is here, you guys tell me if I'm getting the hook. Okay. Larry, I'll run fast, I promise.
So we're very, very proud of our partner announcements. Why did we do these, 1st of all? Well, think about the business that I described. We're doing lots of lift and shift from an on premise environment into the cloud. What do all of our customers look like?
Like what's the chalk outline of a typical customer? They have a lot of Oracle. They have a lot of Microsoft. They virtualize infrastructure on VMware. What are they looking to do when they move it over?
Maybe they have eventual high aspirations, but they want to change as little as possible. And we want to give them really what they need is the ability to put the right workload in the right place and bring as much of their tooling with them. So, for Microsoft, for many customers, the best landing spot for a lot of their Microsoft apps is in Azure. The best landing spot for a lot of their Oracle apps is in Oracle. We put a very simple proposition in front of Microsoft and they thought it was great.
Hey, what if we had 2 clouds that work together and we just make them really close, like make the data centers a millisecond apart, so that you could run one foot of your application over here and another foot over there. You can literally split an application between them. You can have apps talk apps. You can have services talk to services. We'll move up the stack.
Everything composes. That's it. It's very customer centric. Customers love it. We've rolled this out in Virginia.
It's live now in London. We're going to take this around the world. We're going to bring this to U. S. Gov.
And also interestingly, this actually remember I said we're building 36 regions. This factors into citing decisions. We decided as part of this to serve North America. We are doing our U. S.
West region here in the San Francisco area specifically to be close to Azure. 2nd big partnership announcement, we are very, very proud of this. As I said, VMware, a lot of our customer a lot of our workloads that are coming over, they look like run an application stack, Oracle packaged apps or not, middleware, virtualized on top of VMware with an Oracle DB. What we enable customers to do is lift and shift and bring that whole thing over. Our VMware implementation, what we're rolling out in a couple of months with VMware on OCI is actually very, very different than what other vendors have done in the cloud with VMware integrations.
It is directly integrated into our compute, into the compute provisioning experience. You launch an instance and you could run Oracle Linux or Microsoft Windows or other Linuxes or you can run VMware. You get the full VCS stack. You can pick amongst the versions and you can run them on bare metal. This allows you to basically lift and shift literally with high fidelity the environment that you have.
You can move the versions over. You can move the configuration over. You can use the same set of tools. You can use all the features. Under the covers are doing fancy stuff with layer 2 virtualization etcetera to make it work.
But literally it looks like a complete lift and shift of a complete VMware environment into a full OCI environment. You're cheek by jowl with an autonomous DB. You can call that Kubernetes cluster over there that HPC cluster over there. You can call OAC. You can do anything inside of this environment because it's completely integrated.
You can manage your cloud VMware environment from on prem and your on prem environment from the Cloud. You can use vMotion to burst in. It looks like an elastic extension of what you have. Basically, bunch of customers told us to own a VMware that they could run-in our infrastructure just like they do and we gave it to them, others have not. So, we're very, very proud of this.
We think it's phenomenal. And we have had tremendously positive customer feedback on both of these partnerships. In addition to the big bang things, we had some medium bang things, but did it at scale. So, a big announcement in or a big achievement for us in the partner space was integrated billing under UCM, under Universal Credits. Under agreement, like standard agreement, you can simply just click an app store, enterprise app store running on OCI where we provide 1st tier support.
All right. I'm going to talk about this for all of 30 seconds. And the ironic thing is probably this represents about 50% of our actual service portfolio. So, everything we've talked about thus far enables us to lift and shift big enterprise apps or collapse. And that is the obvious thing for us to do and it is very necessary for our business growth and to serve our customers.
But in my view, it's not sufficient because most of the customers that are moving that stuff over are moving to the cloud, not just to get cost advantages, but ultimately to transform themselves, go digital, modernize, etcetera. Pithy summary of this is bring your present, build your future. We need to have a general purpose Cloud to serve them and we do. We have built a full complete stack of container native developer facing tools to give those developers in those businesses the ability to build their future and do what they need to do. In doing that, we have taken an open standards posture because we think proprietary lock in is evil.
And in the Cloud, we have chosen every open standard and every open source interface that we could find available. Our streaming is Kafka. Our orchestration is Terraform. Where we have introduced new technology like functions as a service, we've open sourced it. You can run it on your laptop, run it under the cloud.
And to get things into the hands of developers, and I should say, so, today we have not focused much on marketing to developers. And most of the developers that we anticipate using our platform will come in with a workload like their business will move one of those big workloads and then we'll need to expand it because usually that's a beachhead for a very large expansion. So, as I like to say, you come from the database, but you stay for all the awesomeness. At this point, we want to get this across the world and in front of as many developers as we can. So we announced Free Tier, we have had really a rush of sign ups.
So we're very excited about all this. Larry, we have a customer. It will be about 5 minutes, if that's Okay. Sorry. So, now for something completely different.
So, I've talked a lot about big enterprise workloads, big ERP systems. And I don't think it takes a ton of imagination to know what those look like. What about an application that connects 100 of millions of users that are a rabid fan base of a certain sport? So, I am very, very pleased and excited to bring up Gaurav Duggal from Reliance Jio, who is a big part of the reason why I immediately ran out of capacity in Mumbai at launch. So Thank you, Nava.
Gaurav, welcome.
Thank
you. It is Thank you very much for coming here. It's truly an honor to have you as a customer. So can you tell us a bit about Reliance Jio and the application that you have?
Yes. So Jio is the largest telecom operator in India. It serves around 350 plus 1000000 users, which is, I think, 10% more than total U. S. Population.
And my team has a lot of innovative solutions. So one of them is Play Along, using which we had served around 155,000,000 users in the last cricket fanatic country, Indian Premier League in a 50 day period, and we had served around 10,000,000 users per day. We keep doing a lot of engagements, and our application is 100,000,000 active users per month. There are other applications also apart from that. There is a video bot, which is intent classification bot, which all of that is built on open source and which serves around 300,000,000 utterances a year.
There's another video conferencing solution, which is connect anywhere, anytime, any meeting. And yes, so these are the 3 main applications we've got. Yes.
That's amazing. Just the scale of having that many simultaneous users using an app and interacting with one another, the scale is very, very impressive. So, it sounds like under the covers, there's a few workloads. You have a massive mobile backend to serve that many users during Match Day. You're doing a bunch of video stuff or video streaming transcoding.
And for the chatbot, my understanding is you're doing complex machine learning across, I don't know, 10, a dozen Indian languages to be able to interact.
Right.
Can you tell us more about what your architecture looks like as deployed on OCI?
Yes. So, the first application, which is engagement application, which is highly concurrent, uses proxies in the middle layer, which connects to hundreds of WebSocket cluster. And we have caching Redis is being used as caching and persistent layer is backed by MongoDB. It's all open source. And with respect to the other application, which is video conferencing, we have VMware based transcoding services.
And then all of it is built on MeanStack. The 3rd application, which is a video bot, which uses Spark ML to orchestrate all the APIs. And we have a bidirectional LSTM and BERT to classify our intents, which converts, I think, tens of Indian languages, we are vernacular in nature. And if you come to India, unlike English or European languages, people mix languages, like somebody will speak Hindi in English, English and the various Indian languages. It's very complex.
Awesome. The layman's translation is it's bad ass and it's very modern. It runs at very high scale. They have a very big footprint in OCI. If you don't mind my asking, where did this run before you deployed it on OCI?
Okay. Yes, we were running in Amazon before.
And what were the factors that led you to choose to deploy this on OCI?
So we evaluated OCI. We were waiting for India data center to come up, which has come up lately. And obviously, the total cost of ownership is quite low. And second is the IOPS is very high for block storage, which helps us achieve more from the same machine type shape. And the GPUs which are connected with NIC 50 GBPS Ethernet is excellent to have a clustered training, which reduces our time by 50%.
These are the 3 main reasons.
Awesome. Well, we are truly honored to have you on our platform and that you've chosen us. What's next? What do you plan on doing in the cloud?
Yes. So we are evaluating various other workloads. And we will, with your great customer excellence team and Clay promising us a lot more features. We would be moving a lot more workloads going forward. But yes, we are waiting for the Doctor capability also to come up in next quarter in India itself.
Awesome. Well, Gaurav, thank you so much. Thanks, John. We love having you as a customer. We appreciate it.
A very quick closing comment. Apologize, Larry. So, to tie some things together, we're executing on what we believe is a big phenomenal fantastic business across the globe for a latent untapped market and move of enterprise workloads. And that's what we accentuate. That's what we're built for.
And if we do one thing exceptionally well and get A pluses, it's that. But that's not all that we do. So, we believe the core things that we have that enable that business, fundamentally, it's the apps and it's the database and it's all the customers who run on our apps and our database, the reliance that they have, those are things that I don't mean to brag, but fundamentally they're untouchable. Nobody can build that. All of the things that underlie internet scale applications and the flash mobs and sorry Safra even the Angry Birds of the world, we can build that.
They cannot build what we have, but we can build what they have. And we've actually built a phenomenal general purpose platform. And what you're going to see over time is a change in complexion. We're going to grow big fast, I believe. It's an opinionated forward looking statement.
We're going to grow big fast in the enterprise segment, which we more or less own and complementing that and increasing over time is going to be general purpose workloads and a general purpose cloud. Thanks.
And now, please welcome to the stage Oracle's Chairman of the Board and Chief Technology Officer, Larry Ellison.
That was interesting. I guess if we left that empty chair up here, you might stare at that rather than at me. So or actually, we're paying by the hour. It's a gig economy. So, all of the furniture is rented and are going to save money by sending them back right away.
So again, I'll make I just want to reemphasize what Don said, which is we have some franchise properties, some franchise technologies that we've developed that would be very difficult for anyone else to reproduce. We've been working on Fusion, the Fusion application suite, especially Fusion area, the back office portion of it. We've been working on that for 14 years now, something like that. And if someone wants to reproduce it, they start now and 14 years later, they'll be where we are today. We put a lot of people on this.
We have a lot of expertise. It would be very, very hard to copy that technology. The database, I think we even have a bigger lead over the different databases that are around. There are a lot of database properties. There are a lot of open source database properties, and we support them all on our cloud.
In fact, we are the primary developer of MySQL. We develop not only the Oracle database, but we develop we own the MySQL brand. Amazon Aurora, of course, as you know, is MySQL. We support Mongo. You name it.
By the way, we support it not only in our cloud, but our analytics work with it. Our big data SQL allows you to access not only our block storage, but also virtually any other storage. So, we allow you to bring whatever database you want. The thing that differentiates us is there are lots and lots of existing Oracle databases, and we run Oracle way better than anybody else. So and the Oracle database is, we think, way ahead of any other database round.
So the Fusion Application Suite, NetSuite, the Oracle database, very difficult technologies for anyone else to build. As far as the open source database, can we support MongoDB better than Amazon? I think we can. I think you can have a better MongoDB experience, a better MySQL experience coming to OCI, coming to the Oracle Cloud then you can by going to the Amazon Cloud or the Azure Cloud or the Google Cloud. So we think we can be very competitive there.
We think we can differentiate ourselves there, deliver better performance, better reliability, lower cost, all of those things for the OpenStack, open source technologies and also bring customers who want to take advantage of the Oracle database and our applications. Again, I'll close with this and I'll open and then I'll open up to questions. We are the only infrastructure company that has enterprise applications. We're the only company in the world that offers things like accounting to the largest financial accounting to the largest companies in the world and also offers compute and block storage and archive storage. There's no one else in the infrastructure.
Google does not offer enterprise applications. I've seen Microsoft sometimes listed I saw an analysis that had us as 3, the 3rd largest enterprise apps company with Microsoft number with number 2, Salesforce number 1 and us number 3. That's a big Microsoft doesn't have enterprise apps, unless you say Office is an enterprise app. The Word is an enterprise app, but I mean, we don't compete with Word. Our competitors in the Enterprise Application business, we only have 3 of significance, 2 in the cloud, Salesforce and Workday and one on one that never moved to the cloud and has no plan to move to the cloud and that's SAP.
Those are all the enterprise. Those are all the enterprise apps companies. None of those companies have offer an infrastructure cloud, a complete cloud. We think that gives us a huge advantage over other application companies because when you run the Oracle manufacturing system and accounting system and sales system and service system, you come for that. You big companies make lots of extensions and build lots of bespoke, lots of custom applications to work with those applications that they're renting from us.
Well, Workday has no infrastructure. They have no underlying platform. There's no way they can do that with Workday. There's no real it's Salesforce has a thing called force.com, but it's very primitive. We offer full development environments, full block storage, full we have the whole deal.
They have a very simple system for extending and integrating Salesforce applications to other applications. They're not really an infrastructure business. They don't have an infrastructure cloud. SAP has no cloud. Workday has no platform for extensions and all of that.
So we think the fact that we're in the infrastructure business gives us a huge advantage in the enterprise applications business. And that's why we're growing much faster in the enterprise application business than anybody else. I mean, Salesforce to grow is making a lot of acquisitions. We haven't made a significant acquisition in a very long time. Our ERP systems, the combined growth of our Fusion, ERP and NetSuite ERP is well over 30% growing much faster than Salesforce has grown.
It's all organic. I mean, they can go out and buy an analytics company and say, look, Salesforce is growing really fast. But in fact, Salesforce is not growing really fast. We're growing much faster than there. And it will be very soon when we will pass them in enterprise applications.
And they're going to have a hard time. They don't have back office. We have all the applications they have in the front office. They don't have any of the applications we have in the back office. We believe that suites win.
We believe having an infrastructure to allow you to extend your applications is very, very important in the applications business. So we see ourselves moving into the number one position passing Salesforce very, very quickly. As far as infrastructure is concerned, most of the Oracle databases, virtually all the Oracle databases still run either on premise or what we call cloud to customer. Very little of those mission critical applications have been moved into the cloud. Now we're beginning to see just the tip of the iceberg of some of those people are moving are moving those workloads, moving that data into our cloud.
And they're getting better performance, better availability and saving money all at the same time. And we think this is very, very early days, but we think that's going to be an enormous business for us on the infrastructure side. So we're very optimistic about the 2 businesses that we're in, in the enterprise applications in the cloud, infrastructure in the cloud, everything from our unique technology in terms of the Oracle database to the fact that we deliver the open source stack in a more performant and lower cost way and more reliability than and more scalability than any other cloud. Obviously, we believe it because we will when we meet again next year, have more regions around the world than Amazon. Okay.
That's it. What do you want? Yes.
Hi, Walter Pritchard from Citi. Larry, I think we all agree we're in a pretty unprecedented time of change in the industry. And we're seeing some of your tech peers, Microsoft, but probably a broader group as well that are growing their operating expenses much faster than Oracle has. I think it's been about 1% per year or so over the last 5 years. I'm wondering if you feel like you spent enough there and then the message seems like going forward, you can keep the investment relatively flat.
And why not sort of step on the gas or invest faster in the business given the share that's up for grabs over the next say 5 years?
I think we're investing as fast as we can other than building data centers that are empty. So we will we manufacture our own hardware. We have a just in time replenishment model. So we expand our data centers based on our forecast of usage. So we're growing we might increase our expenses, but when you increase our expenses, it will because the top line is growing very rapidly and profitability is growing very rapidly.
So we have all we're building all of the regions out. And as those regions grow based on demand, we can get hardware there in very short order. We have we make this stuff ourselves. We have it in inventory. We ship it very quickly based on demand.
We have very different model than anybody else. We don't believe in shipping SUVs to dealers. We believe in a Tesla model. So when orders an SUV build an SUV. We think that we don't want to have an inventory problem.
Yes, sir.
Tripp Chaudhry from Global Equities Research. Two quick questions following up on Don's presentation. Of course, Don was the person who created AWS for Amazon. I was wondering Gen 2, how long will it take for Amazon to catch up to Gen 2 cloud from Oracle? And secondly, in the presentation that Don presented, you have 2 government Gen2 data centers in Ashburn, and I think a heartbeat is in Oregon, at least that's what the slide showed.
This is a no brainer for Project Jedi to work on Gen2 Cloud rather than an old generation AWS Cloud. Any thoughts on
that? Well, okay. So how long I'm going to focus on the question. How long before Amazon builds an autonomous database? That's really asking.
How long before Amazon gets up to what is our Gen2 cloud? The Gen2 cloud has lots and lots of components. And what makes our Gen2 Cloud Generation 2 is a technology called machine learning. And specifically, a manifestation of machine learning, where you use machine learning to build autonomous systems, whether they're autonomous driving systems or autonomous database. We just announced an autonomous operating system.
So and more and lots more autonomous features we're building right now. So how long before Amazon catches up to the Oracle Autonomous Database? Well, let's look at what you got to be able to do. When you got it actually autonomously discover a security threat, their robots have to monitor for security threats. And then when a security threat is found, and I'm presuming there's actually a fix for the threat already in place, but if not, the fix has to be built.
But the moment the fix is built, it's then the entire fleet of databases are patched without any downtime. No scheduling, no having to notify customers, hey, we're going to take you down for this period. None of that. We automatically detect a threat. We immediately remediate the threat while the system is still running.
How long before they can do that with any of their any of their database? Now, keep in mind, Amazon is saying, well, we have a special database for transactions. It's called Aurora. But if you're doing queries and analytics, you use Redshift. But then if you want elasticity, you use DynamoDB.
And they believe and I keep going, they have lots and lots of databases they supported Amazon. So while we had to make Oracle autonomous, they have to make Redshift Autonomous. They got to make DynamoDB Autonomous. They got to make Aurora, Redshift, DynamoDB and they've built all the because they have a dozen databases. How long before they they're not going to get one in the next 10 years.
I don't think they can do it. And this is what Don said. We think we can build what they have. And in fact, we think we can build the next generation of what they have. We think we can build what they have, but do a little bit better job.
We should. We know what they've done. We know what Google has done. And we think we can deliver kind of a better version of that for OpenStack stuff. But for any of these databases to patch themselves while running without downtime, for any of these databases to automatically configure themselves without any human intervention, When does Amazon catch up to that?
Certainly not in the next decade. By the way, they're not even trying. They haven't started a project to do that. They're not trying to do that. That's not something they've announced and they're working towards.
By the way, we also and we're putting autonomous characteristics and full autonomy into as many modules as we can. We've just announced our operating system, Linux, that our version of Linux now there's lots of Linux's out there and Red Hat is very, very popular. And it so happens that we have our version of the operating system is compatible with Red Hat, but it's not the same code. Red Hat applications run unchanged. Any Red Hat application runs unchanged on Oracle.
We've had that capability for 13 years, not a single incompatibility bug has ever been filed, okay? But our version of Linux is much faster. Our version of Linux is much more reliable. And our version of Linux can be patched while it's still running. So if there's a security flaw and by the way, there was a massive security flaw.
There were the Spectre meltdown bugs, which were bugs in the Intel microprocessor that We put in, in a 4 hour period, we patched our entire cloud, We put in, in a 4 hour period, we patched our entire cloud 150,000,000 patches in 4 hours. While everyone was still running, all of our users were completely unaware of it, completely unaware of those patches. When does Amazon get that? Let me tell you what Amazon has got. They got a great support policy.
Their support policy is, if you misconfigure 1 of our systems because we're not autonomous, you manually configure our systems. You make this mistake and lose all your data. We don't pay, you pay. So our systems are designed to prevent you from making are autonomous, which prevent you from making configuration errors. They don't have that ability.
So they have a support policy that says, if you make a configuration here, I can put it up. I think it says, you maintain complete control of your data and you configure Amazon services. That's you. So if you make a mistake, don't blame us. That's on you.
I mean, these are huge differences between us and AWS. Listen, AWS is the 1st mover. They had the idea to rent to go ahead and rent computers. It was brilliant. And it's been enormously successful.
And it's really they fundamentally have changed computing. But they really I mean, they don't develop databases. They don't develop programming languages. We develop Java. We develop the Oracle database.
We develop fusion applications. They don't do anything like that. They have no they don't in fact they're a huge user of Oracle. They run their entire business on Oracle. So I know they say they're trying to get off.
Haven't heard much from them lately. They're supposed to be off by the end of the year. We'll find we'll see. SAP said they were getting off of Oracle. A lot of people said they're getting off of Oracle.
So and maybe Amazon can. God bless them. It's fine. But right now from a technology standpoint, we are so many years ahead of them. And I'll just quote Don because I think Don said it perfectly.
What we have, they can't build. What they have, which is the ability to rent open source technology on hardware, we can build that and we can do a better job of delivering that than they do. So we expect to have a highly differentiated business from AWS because we develop a lot of software. Microsoft has a highly differentiated business from AWS. They develop a lot of software.
Amazon cannot develop Office. That's an enormously valuable thing, Microsoft Office. Lots and lots of documents are stored in Microsoft Office. Amazon can't do that. Amazon is not even in that business.
Over here.
Thanks. Hey, Larry. Phil Winslow, Wells Fargo. A couple of big announcements in terms of partnerships made this year, one, just this week with VMware. So when you think historically Microsoft and VMware, we don't think it is the tightest companies with Oracle.
So my question to you is sort of why these partnerships and also just sort of why is now the right time to partner with VMware and Microsoft?
Well, Oracle has really never been a platform company, right? So we've sold database on top of a variety on top of Red Hat Linux, right? So with on premise business, we would sell our database, we'd sell our applications. That's the business we're in. But we've never historically been a platform company.
So now as we now with OCI, we become a platform company. And as a platform company, it's very, very important. So they come to our cloud, if you will, a complete solution, the whole thing. It's not about, hey, we love your database and we love the and we love Java and we love your enterprise apps, but we get a lot of things from other people. And we recognize now we want people to be able to come to our cloud and get everything they need.
Well, one of the things they certainly need is Microsoft Office. And Microsoft Teams is also Microsoft the e mail from Microsoft. Microsoft has lots and lots of assets that are in broad use by companies. So we the best thing for us, what customers wanted us to do was, look, we'd like to come to your cloud, but there are a lot of things you don't have. And so why don't you and Microsoft work together?
I mean, between you, Oracle and Microsoft, that's the vast majority of what we use. And you throw in the open source stuff, which we fully support, very important fully support in our cloud. You take all of the open source stuff, you make that available plus your the Microsoft stuff and the Oracle applications and database and Microsoft Office and Mail and Excel Analytics and all of that jazz. There's a long list of Microsoft stuff. You put that stuff together, it's great.
And they say, oh, one more thing. Actually, probably they say 2 more things. They say one more thing, VMware. We got a big investment in VMware. So we want to be able to take our preserve those investments, protect those investments and lift and shift their VMware configurations into our cloud and maintaining and use the same tools and the same procedures already have in place on premise.
The other thing they might have they have an investment in is Red Hat Linux. But that's one thing we think they shouldn't bring over to our cloud. By the way, you can. You can actually run Red Hat Linux in our cloud, get support from Red Hat and all that stuff. That's not a problem.
But we think we offer Oracle Linux, which is 100% Red Hat Compatible for free in our cloud. And it's autonomous. It's much more secure, much safer to use than using IBM's Red Hat Lax. So in that particular case, we thought the technology we offered and by the way, converting from Red Hat to Oracle Linux is you change one pointer in your system to point at our update server. You don't you don't even have to reboot this.
You do it while it's live. You don't have to reboot the system. There's no recompilation, retesting. There's virtually nothing to do. It's really easy.
And you get all the benefits of Oracle Autonomous Linux. So that's one case where we thought, all right, should we fight with IBM and try to make a deal with them? We said, no, actually customers can be way better off and it's trivial to make for them to upgrade from Red Hat to an autonomous system. We also think from the point of view of running an system that configures itself that you can patch while it's running is so much better than what Red Hat offers is so much safer, so much faster that in that case and the migration is instantaneous. I mean, there's really virtually nothing to do.
In that case, we expect customers to hope customers will simply upgrade to our version of Linux rather than sticking with Red Hat. But again, we're a full platform. We've got to be a full platform. Someone's going to be able to run their business, all of it, run their IT, all of it on our cloud, connect up with Microsoft, connect up with VMware, have a compatible replacement for Red Hat. And we're pretty much we run all the open source stuff and we're pretty much there.
Yes.
Hey, Larry Kasrangan from B. F. A. Merrill. How are you?
I wanted to ask you a question on digital transformation. That's something that we've not heard much out of Oracle, but a lot of software companies are chalking up their results to this big phenomenon that's pervading the customer base. So your I'm sorry, I missed Digital transformation. Digital transformation is right.
Yes, I mean it's aspirational. I think the we're working on a lot of advanced technology, which we think enables digital transformation. Our applications, for example, which sit on top of our Generation 2 cloud, take advantage of our the Oracle Digital Assistant, a robot that allows you to talk to your applications and allows the applications by the way to talk to you and to send you messages and all of these other things. So we think I think Don is exactly right. What customers want to do, they want to move to the cloud.
There's economic benefits in doing that. And there's reliability, security benefits in doing that. But basically, that's step 1. So they want to move their workload to the cloud and then they want to modernize their business using the latest and greatest technologies and adopt. So kind of move over what you currently have and then fully exploit our Gen2 cloud to start their digital transformation.
And we offer lots and lots of tools for doing that. We offer analytic tools that actually will tell you what expense reports are kind of not normal, are surprising. We use machine learning. We have easy to use machine learning tools in our Gen 2 cloud. So we try to machine learning is maybe the most important new technology in the last 10 years.
In fact, you probably can say maybe it's the most important things that computers have ever done, that the computers can now learn. And part of the digital transformation will be taking advantage of these new technologies. The new technologies those technologies have enabled our autonomous database. Those technologies will allow to look at their customers look at their data in new ways for the data to actually kind of people say, okay, this expense reports an outlier. This particular transaction should not allow to be go to go through.
So we think people want to shift their existing workloads and then start their digital transformation. And we think we have offer a broad toolset in our cloud. That's 2 missions. We got to make it easy to move what you have into our cloud. And then once you get there, we've got to make it easier for you to evolve what you moved into a next generation of applications and technology that will digitally transform your business.
But until we but we got to get you into the cloud, it's kind of hard if we don't move you into the cloud first. They go hand in hand. Step 1, move what you have. Step 2, start improving it and enhancing it. It's not leave what you have in place and then completely start over in the cloud.
That is not going to work, I don't think. Gentleman right next to me.
Hey, Larry. Alex Zukin from RBC. I wanted to ask, you mentioned we're at the tip of the iceberg for the workloads that you have today on the Oracle database moving to the cloud. And I wanted to ask over what time period and actually even looked like international growth is that or demand is outstripping domestic. So I wanted to ask over what time period you think the workloads will move?
What percentage share will move? And how does the market share between you, Amazon, Google, Microsoft look over the next 5 years?
Well, it's really I mean, it's really interesting. I mean, our database business has been growing. Our middleware business has been in decline. A lot of it is very interesting. I mean, I almost don't like talking about this, but people say, hey, Oracle is flat.
There's no growth. Oracle is flat. There's no growth. Actually, if you look at one number, that's the only number you look at. In revenue, yes, we're okay.
I mean, we're growing slowly, right? However, there's incredible change in our technology businesses and our application businesses. As I said, we're by far the fastest growing application enterprise application companies. Organic growth of 30% in back office, both NetSuite, that's combined NetSuite Fusion number, 30%. We didn't buy anything.
Salesforce, unbelievable. They got to keep that 20% growth number, right? Or their stock price collapses. They got to buy somebody. I mean, they're on a hamster wheel and it doesn't matter what they buy.
They got to buy something. We're not doing that. Our database business has never stopped growing, never stopped growing. Our middleware business, however, which is part of our tech on premise business, along with a lot of our databases on prem, though it's really not on prem, it's licenses. Everyone's we have this funny situation where you say, well, how much is cloud?
How much is on prem? Well, what is a license? You run the license in our cloud. So we let you bring your on prem licenses that you pay on prem support for, we let you bring that to the cloud. Our database business is growing.
We're actually gaining share in database. Actually gaining market share in database. We think we get 90% of it in our cloud. How big is that? Way bigger than Amazon.
I mean, Amazon is going to grow, don't you be wrong. But if you suddenly said, okay, I'm going to move all the application, all those Oracle databases and all the applications that are on the Oracle databases in the world instantly to our cloud, tomorrow, we'd be way bigger than Amazon and Azure. We'd be bigger than Amazon and Azure combined, right? So all but all that stuff is going to move. And they don't get there's no autonomous database that can run on Amazon.
They're not going to have never have autonomous database capability. They don't get any of that. They don't get any of this new stuff. So it's not like, oh, Amazon, we're going to we'll run Oracle for you. I mean, they can an old version of Oracle without a lot of the without the ability to patch itself online without the ability to configure itself, yes, they can do some of that.
They can run permitted version of Oracle. But they really can't run modern Oracle. Where is it going to go? They can stay on prem or they can move into our cloud. But let me tell you another thing.
Some of our biggest customers are going to become OCI regions. IBM says I hate this term private cloud. I really don't like it because what is a private cloud? It's a computer. And I assume we rename a computer a private cloud.
That's nonsense. We will build an OCI region identical to the OCI regions we have in Ashburn and in Mumbai and all this. We will build an OCI region at a big bank, let's say. And that big bank so if they want to say on prem or in their data center, they can stay in their data center. We'll build a complete region for them.
They can take all their Oracle stuff, all their application and run it in our cloud. It's just that our cloud, which we will manage. And you don't have to buy the hardware. We'll ship all the hardware there. We'll configure this whole thing.
We'll put that whole region into your data center. So when we talk about having nearly 40 regions next year this time next year, Those are public regions. We're not talking about regions we're going to end up building for our biggest customers. And we have a lot of really big customers. So that's another avenue of growth.
And we think we'll be announcing some of those soon. People deciding, okay, build a region. We're a big bank, build us a region. We can do that. Amazon can't do that.
Azure can't do that. So, we think we're going to get virtually all of the Oracle databases, which is most of the world's data. It sounds crazy, right? Because what people what is it? If Oracle really holds on to its database franchise and moves it to the cloud, I'll ask you.
It is most interesting question of the day. So how big is Oracle? If we hold on to our database franchise? Think about all the applications that are built on top of Oracle databases. Remember, we were way bigger than IBM and Microsoft combined in the database business.
Still are. Still are. If that all moves to the cloud and we get it, how big are we? You think we're bigger than Amazon? I mean, I'm asking here.
What do you think? 200,000,000,000. Yeah. 200,000,000,000. Yeah.
Easy, right? So but you say, Ah, that's ridiculous. People just move off the Oracle database. Really? No one's moved off the Oracle database.
Name somebody. Go on to Amazon's website and they'll show you names of companies moved up the Oracle database. You've never heard of those companies. Bob and Sarah's Pie Shop and Towing Company. Biloxi, Mississippi, Bob Deceased, Sarah still available.
It is I mean, it's a bizarre question. So you either have to believe that people are just going to stop using the Oracle database or we have the biggest cloud on the planet because it's not Satya Nadella Satya Nadella was asked a couple of years ago. What's the if you could have any technology in the world, any technology in the world, what would he have? Well, maybe he's really stupid, but he didn't say Google search, he said the Oracle database. Why?
Because this is the information age and we manage almost all the world's information. Manage it. Google catalogs it. Google catalogs to vast amounts of but they don't manage it. They catalog it and provide access to it and do all of that.
It's a big deal. Very important. But they're actually sitting in Oracle databases. So I mean, that's the prize, right? If we execute well, that's the prize.
Markets certainly haven't reflected that. That's okay. I'll give you my favorite market observation. Right now, the private markets things we companies are worth more than Tesla. And the public markets think that Uber is worth more than Tesla.
I'd love you to write list all the technology that Uber has and all the technology that WeWork has on that side and let me list all the technology that Tesla has. And let's see who has a longer list. But it's fast but it's interesting. It's all very interesting. That's why we're aggressive buyers of our stock.
What can I say? We're pretty optimistic and we think we have these 2 franchises we're not going to lose and this great new technology called OCI, which we think is the newest people even say, hey, we're late. We'd like to think of it slightly differently that we're the newest and greatest cloud out there. We're the most modern and most capable cloud out there. We had the advantage of watching what other people had done before us.
And so we're excited about our 2nd generation cloud. We're excited about our growth rate in enterprise applications that will send us way past Salesforce. And but it's not just that we're past Salesforce. Anyone know what our market share is in cloud ERP? Just to randomly talk about things.
What do you think our market share in cloud ERP is? 80%. 80%. Okay. No.
Much too low. And I know it's asymptotic. It can't be 100. It's not 100. But it's probably over 98.
I think our closest cloud ERP enterprise ERP customer is Workday with according to Workday a few 100 customers. And we have what's the right number, Steve? NetSuite, we have 32,000? Yes. No, but that's Fusion.
That's not just that's maybe 20 ERP is 25,000.
Yes. ERP is
7,000 infusion.
Yes. The total is 32,000. So Workday has couple of 100 and we have 32,000. So it's more than 99%. That would even make Bill Gates proud back in the day.
Salesforce has no product. Workday really has no product. SAP didn't move ERP to the cloud. How much does that work? So let's just look at these fantasies.
So now you know what I wander around. And I don't really work. I just wander around fantasize about stuff. So what is that franchise worth? What is the ERP franchise worth in cloud if we have 99% share?
Or let's say erodes to 88% share or 85% what's that worth?
And how big is it?
Moving all the Oracle data to the cloud, what's that worth? How big is it? If Don wasn't making stuff up, we have a general we regularly do benchmarks against Amazon. And because we know I mean, We're just kidding ourselves. But we we have to be better.
We're just kidding ourselves. But we continuously beat them their performance. When people look at a workload in Amazon or move a workload from Amazon to our cloud, even if it's using all the same open source software, It's going to be using a Mongo database or application written in Python, whatever. And they move that stuff over to our cloud and we cost half as much. We scale better.
We're more robust. And that's without using any of our cool database stuff or any of our cool enterprise application stuff that other people don't have at all. So we think we have the best cloud, OCI. We think we have the best database, Oracle Autonomous Database with best operating system, Oracle Autonomous Linux, the best enterprise application certainly in the back office. Now salesforce.com is the incumbent in the front office especially in sales And we recognize that.
But we're starting just beginning to start replacing them in some of their large customers. They're very expensive. So we compete we'll go in there and say we can cut your bill by a large amount of money with some of their larger customers who are who think that this salesforce.com is overpriced. So that's our strategy. Those are the opportunities.
We think the size of the opportunities are just monumental. Yes, sir. And then I'll come right here next.
Thanks very much. Michael Turits from Raymond James. So Larry, Don finished up by talking about open source and cloud native computing, and you've talked about it quite a bit today too. If you're going to be successful doing that in Gen 2 Cloud, does that require more investment in other databases besides Oracle Database?
Well, I said, we are the steward of MySQL. So we are we probably invest in Linux. So let me not just limit the databases. Yes, I mean, clearly, we invest in MySQL and MySQL services and very, very important to us. We invest in Java, languages, but not just Java, we invest in runtimes and environments for everything.
For Ruby, We have the Graal environment, which runs Java plus JavaScript and Ruby and Python and everything much faster. We're investing in all of these standard languages. Obviously, we've invested very heavily in Linux. I mean, clearly another open important open technology. I mentioned MySQL.
You'll see us with constantly building more and more services around that. So we will certainly our goal is to if you want to use MySQL or Aurora, whatever you want to call it, the best version of it should be in the Oracle Cloud. You should have a better experience with using MySQL in the Oracle Cloud than in Amazon or Azure. We're even putting SQL Server directly into OCI, current and previous versions of Microsoft SQL Server. So we want so we are investing in other databases.
We're investing in MySQL. We're investing. But the storage around MongoDB. So MongoDB doesn't operate on its own. I mean, MongoDB accesses our storage systems.
So providing very reliable, very robust, very high performance storage systems. We are I announced on Monday that our newest storage systems are not usually you have to pick all flash, all rotating storage. Our newest storage systems are a storage hierarchy made up of a combination of rotating disk plus flash cache to that plus DRAM cache, persistent memory cache in front of that. So we're building these storage hierarchy systems, which makes Mongo much faster, which makes MySQL much faster, it makes these things much faster. So yes, we think we have to have a deliver open source technology in a more easier to consume, more performant, more reliable, more economic way than our cloud competitors.
I mean, we have to do that. That's or we're missing a huge opportunity, another huge opportunity because people are going to be using a lot of these technologies around our applications, around the Oracle database, around all these other things. So yes, we are trying to hit on all cylinders. But what you say is correct. We've got to deliver open source, open stack technology better than AWS to realize the full opportunity of the cloud.
Yes, sir. 1 than the other. Let's do both.
Hi, Larry. Derrick Wood at Cowen. So it seems like you've solved the technology side of the equation on Oracle Cloud Platform and now you're quickly trying to build out data center capacity. The next phase is now getting enterprise customers to move their big apps over. So what's the strategy to push customers over?
And can you give us a sense for how the time and effort needed to migrate from on premise to OCI?
Well, the answer is, I mean, our VMware partnership is very, very important to make it easier for people to lift and shift. We have an awful lot of companies that want to do the lift and shift. But again, I'm glad I came in for these parts of Don's presentation. They have aspirations, but they also want to change as little as possible when they move because they don't have to retest everything. If you can really lift and shift and leave it intact, you can do a minimum of testing, but you didn't change much.
So it should keep working. It shortens the time and lowers the cost of shifting things to the cloud. So the VMware was very important as far as that's concerned. The so we're trying to make sure that the tooling is in place to make that easy. Also, Autonomous Database is now so much better than the Oracle that came before, the Oracle that they're running on prem.
There's a huge incentive for them to modern for their applications to take advantage of database autonomy. So we're seeing the autonomous database now adoption rate beginning to spike. 500 new customers this past quarter, we'll have over 1,000 new customers in this quarter. It's now happening. Now it's happening.
They'll take an existing data warehouse or a new data warehouse project. They'll move that over. They will they typically start slowly. So what happens is, you get a team of people involved in one project, they move the project over, they report back to IT, there was a successful, how much it cost, what were the performance gains, people moving stuff from Amazon to Oracle, okay, they said, we're going to save half our money. Did that really happen?
Were they making that stuff up? How hard was it to move? What is the cloud like versus Amazon? So all we're seeing all of that activity now. But it's they're typically smallish projects when you're talking about the autonomous database.
It's not someone who said, okay, I've decided to lift my entire estate and move it over. We have people looking at that. But now I can start naming customers that are looking at doing that. But if I can name them, it's not enough. Because what we're seeing for the first time, people say, yes, I want to lift the entire state, okay.
I'm very impressed with what I've seen. Want to take further steps and move forward. I want to now I want to talk to you about a better not your standard list prices. I want to negotiate a deal, all of those things. So we're we've made it we've now made it easy enough to consume.
We've gotten to the point where it's easy enough to consume. We have a lot of people moving over small projects. And that's going to and those projects have been very, very successful. And we're seeing the first expansions. And sometimes the second order expansion is, okay, I want to come up with a plan to move the to move this entire data center over.
We're just beginning to see that. But again, the infrastructure business is relatively immature compared to our application business. But the infrastructure business, I think, will be much larger than our application business.
Hi. Thanks, Larry. My name is Colin DeCharm. I'm with Sterling Capital. My question is, what indicates to you that Integrated Stack is the right strategy from here forward?
Clearly, as a product company, the legacy of Integrated Stack served you well. But now going forward as a service company and walking around open world and chatting with some of your customers, obviously, Oracle fans all, what I hear is they enjoy the empowerment of module of a more modular stack, whether infrastructure agnostic, etcetera. So can you do both well? I hear integration as a key advantage from both you and SAP for today. One of the hallmarks of a credible open model to me is a robust developer community.
You've got one with Java. How do you engender that to the extent Microsoft or Amazon has? Thanks.
It's extremely interesting question because people talk about building applications with microservices, lots and lots of and having a huge library of different services to choose from and having lots and lots of choice and being able to configure whatever technologies they want to configure. This reminds me of the days of object oriented programming. When I was a boy programmer and object oriented programming, it was going to it was the wave of the future and there's going to be these object libraries. And it was all about programmer use. That as a programmer, I was no longer going to actually write much code.
I was simply going to select components from an object library and assemble them, if you will. And then I might slightly modify a few of them. It wasn't called modification, But anyway, but that's that was kind of the new model. And that model actually worked for UI, worked for certain things, didn't work very well for a lot of programs because you had a real hard time figuring out what each one of these programming modules did exactly. You had to learn what learn the interfaces and the characteristics of all of these components.
If you go on the message boards and look at what people are saying about AWS, it's absolutely fascinating. It's very different than what I would intuitively, you know, would guess. But, you know, I like to guess about things like to sit in a dark room and figure everything out with no information. And then, okay, now I'm going to actually go look. It's like the French Academy.
The French Academy argued for years about how many teeth a horse had in his lower jaw. But they were slaves to deductive reasoning and empiricism was just beneath them. And then finally someone actually kind of looked. So actually I think mix mode is good. I mean it's good to have both deductive reasoning and empirical investigations.
Anyway that's a bit of a depression. The thing that people complain about in Amazon is there's so much stuff in the cloud, they don't know what to use. I mean, it is so to me, it was so I was like, wow, that is so interesting. But you get on the message boards and you see what developers are talking about. And it's like because Amazon is always in there adding all the stuff.
And they're basically taking all opens it's not exactly curated either. It's a library, a huge library of all of these services. But it's not as curated as if you will their retail shop, which will tell you you should buy this flashlight. These are the most popular flashlights and this is Amazon Prime and all of this. There are all of these services and it can be a bit difficult and confusing as what to assemble when you have too many there's such a thing as too many choices on the menu.
And there and it's about a balance. So choice is good, too many options without kind of a ranking of what people don't know what to use. The people have a hard time navigating through all the different cloud services. So we think we need to so we're going to we have a dual strategy. So we think we should offer a large basket of services, certainly all of the popular ones.
We think we should invest heavily in making those services the best making OCI the best place to acquire those services. But also to have, if you will, Amazon Prime Technologies, where we really recommend you use this for this or recommend you use that for that. And that's going to be very important. And I think for certain things where availability is important, where availability is important, The Oracle database is really good at that. We do upgrades.
You get new versions of Oracle, while Oracle is still running, it doesn't go down. So if you have a highly if you need high availability, that's important. So I think providing integrated suites, things that work well together that you know have worked that lots of people are using together. Well, I'll give you another example of integration. The Apple iPhone and admittedly, I think other smartphones are getting better and are kind of catching up.
But for a long time, the fact that all those pieces were kind of curated and integrated by Apple. It was a better a much better experience in the beginning. And the phone an iPhone is a way simpler thing than an application and infrastructure cloud. That's a pretty simple piece of digital technology compared to a cloud. So I think we have to walk down both roads.
We have our recommended technologies. We have recommended suites of technology. These things work well together. But we also offer the choice choices you'd expect in open source. I think we have to do both.
Yes, sir.
Hi, Jeremy Schell from Jarislowsky Fraser. I can ask a non product question if that's okay. So to me the departures of Thomas Curran and the absence of Mark put into sharper focus succession planning. I'm curious from a governance perspective, what sort of steps are being put in place to ensure continued success over the next 10 to 20 years?
Well, I mean, a lot of people have said, God, you guys are weird. 2 CEOs, that's ridiculous. That's bad governance. And so and I think we have a very deep team. I believe in the dual CEO that the normal case, the normal case would be dual CEO here for obvious reasons that it's good to have capacity and good to have specialization.
So and then God forbid something untoward should happen. You have capacity. You're not incapacitated. We're very lucky. Safra has been here for a long time.
Has been very familiar with Oracle Corporation. It's not like we have to rush out and hire somebody to be CEO. We have a very deep team of experienced people around the world. One of the things I promised our Board of Directors is we're going to put we're going to give them a list of 5 people inside the company, all of whom we think can be CEO, kind of his next gen CEO. And so we're constantly making sure that our management team that there are people on the management team.
By the way, not everyone who's doing a spectacular job necessarily even wants to be CEO. Let me tell you, I'm really happy about not being CEO. I love I much prefer my job I have now than when I was I like it better than being CEO. But we should have people in the company that are capable of being promoted into that position. So when there is a succession, it's not rushing out and doing a search.
It's knowing we have these assets that are familiar with the company, familiar with the personalities. But I mean, this is a complicated company. We have a lot of technologies. We have a large selling organization. We have a large service organization.
We have a lot of underlying technologies. So it is we make our own hardware. I mean, it is a complicated company. We used to make our own semiconductors and we very may well again. So we think that's very important.
We think that's very important. If Tesla makes our own batteries, we probably should make our own semiconductors. Not that I want to constantly refer to Elon Musk, but it is reasonable. It's reasonable. It's not necessary for us to make our own semiconductors.
But if we can get an advantage that way, then we should do it. So we're in a lot of different technologies. We have promised the Board, I have promised the Board that we will have 5 people and we're starting to run people by the Board that are have the potential to be CEO next round. I don't think Safra is going any place. At least she hasn't indicated to me that she's going any place.
We're pretty happy with her. So we think we're in pretty good shape. We've got again, I think we've got quality and quantity on our management team. The current layer of people who are really running the company. I guess today you've seen Steve Miranda, you've seen Don Johnson.
These people are all slightly younger than I am. So I think hopefully they're going to be around a long time. We certainly want them to be around a long time. So we can grow because they can grow. So I'm very comfortable actually with the decisions we took in the past in terms of how we ran the company and how it's enabled us to deal with Mark's absence.
God willing, he comes back. All is well, he recovers and comes back. But in his absence, we have the capacity to continue to run the company and continue to make progress in our markets.
Of all this. Are you good with that?
I'm good. Unless no, no, no. I'm good.
Thank you
all very much.
For now. Thank you. So listen, we talked about Mike coming up and taking more questions. But we've run very late. I'm perfectly willing to take questions, more questions if you want.
Though I have a feeling none of you were saving any questions for me. You got them all on Larry. Do you have more questions? Yes. Okay.
We'll take it. All of you don't have to stay. We've gone right through your break by the way. I know that. So there's a question.
This might be the last one. I'll take Larry's seat.
In the way between us and the break.
No, break we missed the break. That's so far gone, guys. That was an hour and a half ago.
But Alex Sougan from RBC. I just wanted to ask a quick question about something from the earnings call, which was the macro. I think a lot of people were expecting you guys to talk about the macro as an impediment, maybe not as other companies have. What are you seeing internationally that's different from a lot of the other big tech companies? And what's making you more resilient?
You know what? We have been there was this question about if we spent more, would we grow faster and all of that. And we have been working really hard in making sure all our services are ready to go. And interestingly, we've now launched our free offering, just the free offering. It's really to it's a taster and if you like it, then you start buying stuff.
And we always we don't offer stuff free until it's really fantastic. And so what's happened is for us, we are now on the field. I mean, you saw Reliance Jiao. I mean, for those of you, Jio, those of you who follow the telecommunications wars in India, the just massive volumes of what's going on over there. It is quite interesting what the uptake is for our service.
There is a massive pent up demand. Many of our customers are only now getting to the point to understand that we've got references. So is it if there's a giant global slowdown, is it going to hit us in one way? I don't know. I mean, we have so much potential to for customers waiting to spend less and get rid of their data centers and hard to say.
We're not seeing it right now. So, but listen, I mean, I remember the Internet bubble implosion. We go into that or the 2,008 financial crisis. People stop doing anything whatsoever. We're not seeing anything like that.
We're not even I mean, even like our U. K. Team, you would think we would be having Brexit problems. My U. K.
Team hit their numbers. So when I get a question something's because you'd expect something, right? So, I something's because you'd expect something, right? So again, like to have a situation where we have not officially opened, launched the India data center because I know we didn't launch it because I just did the video for the launch at the end of last week and we had to drop ship kit to build it out even bigger.
I don't
know what to tell you. For us, I will say one thing. China has never been a big market for us, okay? It has never been a big market. We are an extremely security focused national security enterprise.
China, not a big market for us for a number of reasons. I won't go through them here. But it's not a big market for us. As a result, if China is just has much less effect on us. We don't have a data center in China.
We've not partnered to over launch a data center in China. We do not have a Chinese partner. Okay? So those kind of things maybe that's what's part of it too. Okay, more questions.
We've started the trend. Okay. We should order in dinner soon. Go ahead.
This will
be our last question, everybody.
There's one and another. I'm going to regret this. I can feel it.
Go ahead.
Derek Wood at Cowen. Now that your application portfolio is on OCI, it's got embedded ML and embedded analytics. Are you thinking any different about pricing or premium SKUs or any different way to monetize it?
No. So let me tell you what we want to do. We actually want to continue to simplify our product line, okay? We want everyone to go there. We want to clean up because as you sometimes folks show market share of the existing base right now.
Between us and SAP, I'm not even sure that's half. So there's a whole bunch of other stuff, companies that some of you were in high school when they were big, okay? But customers are still running them. We're going to clean up all of that and we want to make that compelling, easy, easy, easy. We want to get the e business suite over.
And then when these customers get sufficiently pissed off at what SAP is doing and realize that they did not write a new product for the cloud, that hosting is not at all the same that you're not going to get new features every 90 days the way you do in a real cloud product and all that we're going to get those guys too. So we're not trying to premium price. What we're trying to do is get entire enterprises. We're trying to simplify the product line. Let our customers have a lot of flexibility, the same kind of flexibility they had with the E Business Suite.
You bought financials. You didn't buy 100 users of GL and 100 or 200 users of AP and 300 users of AR. That's the kind of simplification we want to make it easy. And there's so much market share out there that's sitting We're
just going to pick it all up. And does that include moving offering quarterly invoicing because we've heard that maybe happening a little bit more? And how would that impact your cash conversion?
Usually, we don't invoice quarterly for ERP type stuff. Most customers make to 1 year agreements, gives us a lot more flexibility. Of course, our customers would like to lock in their prices for the next 3 years and things like that. And we can work all that kind of stuff out. Folks don't want to I mean, the actual trend is they'd like to know what it's going to cost them the next couple of years.
But we're fine with that. We don't get a lot of demand. Now we do have pay as you go, where and that's for the technology part of it. If you don't want to make the commitment at all and you want to just pay, you use it, you pay for it, we're good with that too. You don't get much of a discount that way.
But pay as you go, we love that. We are totally into we'll bill you. And because discounts much lower there. Most big enterprises, they don't like that so much. They like their discounts.
And they're perfect and they know how much they got. They want to they'd like to buy in bulk. What else we got? Are we clear? Is everyone down?
I see no hands. One last hand. I did promise you I would not leave until you got all your questions answered.
I'll pay for Chinese if we want to hold.
That's all right. Good. Good. Shoot for me.
Thank you for sticking around, Seth. Keith Weiss from Morgan Stanley.
Larry Ellison,
he mentioned that Oracle hasn't been making the big acquisitions. He's noting salesforce.com has done a couple more recently. But you guys used to do the big acquisitions. And frankly, you did them really well. You executed really sharply against those acquisitions.
Why not? Like why aren't we doing acquisitions?
Well, we're buying little things.
The big ones?
Because what's there to buy? We wanted to build it. It's much better to have a product that I don't have to buy and rebuild. I mean, every single one of those cloud acquisitions had to be completely rewritten to clean up the stack to be at our level. Every product we've ever bought has ultimately had to be rewritten.
Even things in the old days on the on premise, you guys probably don't realize, when we bought BEA and WebLogic, we took it off the market for a little while because parts of it had to be rewritten to our security standards. Imagine what we have to do with all these cloud properties. So the entire Fusion suite is completely consistent. It is written to our security level. It is written entirely in our tech stack.
It is built both to fit together horizontally and vertically. Every time we buy one of these things, as easy as it is to add the revenue numbers for a year or so, do you know the amount of work the technical people have to do to get it to the level of expectation of our customers? It's massive. And then we you know, about this hamster wheel, you got it because they got to keep growing. So now, about this hamster wheel, you got it because they got to keep growing.
So now they're adding this and then they'll add that just to make the numbers add. Our ERP business growing 30 something percent. We'll take it. We think that as that number gets bigger, it's going to have a positive impact plus simultaneously I can tell this thing is a problem. The simultaneously autonomous database, Gen2 cloud is just starting to roll.
It's small, it's getting bigger. You can see it's getting bigger, especially Gen 2 cloud on its own. Autonomous database growing at 3 digits across on a small base that's going to kick in. We're not going to need an acquisition to get to our growth numbers. And the things that are growing are big enough, everything else is going to take care of itself.
So we don't need an applications. Nobody is even close to us. So anyway, that's why. But if we saw something and it went incredibly on sale and my team thought they had absolutely nothing else to do in development, we would totally sign up for that. And I actually I love M and A.
I teach an M and A class at Stanford. In fact, class starts next Friday. Okay.
Thank you.
And yes, you're so welcome. Okay, I'm getting the hook. That's it. We are done. Thank you for being with us.
We had a great time. I hope you did too. Thank you, everyone.
Thank you, everybody. That's a wrap. Thank you very much for coming this year. We'll see you next year. Safe travels home.
Take care, everybody. Bye bye.