After reporting an increase of 13% in bookings due to the close scrutiny of its cloud computing business, Oracle Corp is making progress in its bid to gain more market share in the competitive market.

The remaining performance obligation for Oracle’s sales backlog stood at $80 billion at the end of the last quarter, surpassing analysts’ expectations of $59 billion. CEO Safra Catz hinted at this figure, stating that the momentum was driven by ‘large new cloud infrastructure contracts signed in the third quarter.’

The company based in Austin, known for its database software, is focused on expanding its cloud infrastructure business to compete with Amazon.com Inc., Microsoft Corp., and Alphabet Inc.’s Google. Facing challenges due to a recent slowdown in development, signs of stability have emerged in the third quarter, with sales almost matching the pace of its previous three months.

The shares surged to $130.72 in extended trading, recovering from a nearly 10% decline in Oracle’s stock over the past six months by the end of Monday. This caused the iShares Software ETF to lag behind, experiencing a growth of only 16%.

We hope to continue securing significant contracts that preserve cloud infrastructure capacity,” said Katz in a conference call, noting that Oracle is rapidly opening new data centers to fulfill demand swiftly.

The company stated that in the ending period of February, cloud revenue increased by 25%, reaching $5.1 billion, surpassing Wall Street’s estimate of $5.06 billion. Of this, $1.8 billion came from renting computing power and storage on the internet, while $3.3 billion originated from applications.

Jeffrey analyst Brent Thill stated in an interview on Bloomberg TV that the results were ‘certainly better than feared,’ noting that other cloud vendors like Amazon and Microsoft have recently reported similarly strong outcomes.

According to Bloomberg’s compiled figures, total sales in the third quarter of the financial year increased by 7.1% to reach $13.3 billion, aligning closely with analysts’ estimates. Excluding certain items, the profit per share was $1.41, slightly surpassing the average estimate of $1.38.

Sales for Fusion Software in the quarter increased by 18% compared to the same period last year in the realm of corporate financial management. Revenue from NetSuite, the enterprise resource planning tool for small and medium-sized enterprises, saw a 21% growth. In the previous period, both businesses experienced a 21% increase in revenue.

After acquiring the electronic health record company Cerner, Oracle has focused on modernizing its old software business. Chairman Larry Ellison stated that in this quarter, ‘most of Cerner’s customers’ have been transitioned to Oracle Cloud infrastructure. He mentioned that upcoming updates, such as a new suite of applications, will transform Cerner and Oracle’s healthcare operations into a ‘high-growth business for the years to come.’

In the current quarter ending in May, Katze stated that revenue is expected to increase by approximately 5%. He mentioned that without a server, cloud revenue will be around 23%. Katze also noted that server revenue growth is anticipated to rebound in the financial year ending in May 2025, citing a ‘significant obstacle’ for revenue growth this year.

Katze stated that capital expenditure in the current fiscal year will be up to 7.5 billion dollars. He mentioned that as the company builds more data centers to meet the demand for cloud computing, spending is expected to increase to 10 billion dollars in the financial year 2025. This is approximately above the average analyst estimate of $8.9 billion.