06:29 AM EDT, 06/12/2024 (MT Newswires) -- Oracle (ORCL) shares jumped early Wednesday after the software maker gave an outlook for annual growth in its fiscal first-quarter revenue and earnings and announced cloud partnerships with OpenAI and Google ( GOOG ), even though results came in lower than expected in the preceding period.

Adjusted earnings are set to come in between $1.31 and $1.35 a share for the ongoing quarter, reflecting gains of 10% to 14% on a yearly basis, Chief Executive Safra Catz said during a late Tuesday earnings call, according to a Capital IQ transcript. The Street is currently looking for normalized EPS of $1.33. The stock climbed 8.8% in premarket activity.

Revenue is pegged to rise by 5% to 7%, with cloud revenue to move up by 20% to 22%, Catz said. Foreign currency is forecast to be a headwind of 1% on overall revenue in the first quarter and have a negative impact of $0.01 or $0.02 per share on earnings, the CEO told analysts.

The company anticipates strong and persistent demand in cloud to drive sales and remaining performance obligations, or RPO, "even higher," resulting in double-digit revenue growth in fiscal 2025, Catz said on the call. In the just ended fiscal year, revenue rose 6% each in dollar terms and constant currency. "I also expect that each successive quarter should grow faster than the previous quarter as (Oracle cloud infrastructure) capacity increases to meet demand," she added.

Oracle reported adjusted EPS of $1.63 for the three months through May, down from $1.67 the year before, trailing the Capital IQ-polled consensus of $1.65. Revenue increased 3% to $14.29 billion, but fell short of analysts' $14.57 billion estimate.

Cloud services and license support sales advanced 9% to $10.23 billion, while the cloud license and on-premise license segment dropped 15% to $1.84 billion. The hardware and services divisions logged declines of 1% and 6%, respectively. Oracle's total RPO surged 44% in constant currency to $98 billion, as it signed several large deals during the quarter, with more in the pipeline, Catz said. The company expects about 39% of total RPO to be recognized as revenue over the next 12 months.

In a separate statement, Oracle said it will extend Microsoft's ( MSFT ) Azure Al platform to its cloud infrastructure platform as part of an extended partnership to provide additional capacity for OpenAI, the research and development company behind ChatGPT and backed by the technology giant.

Oracle also disclosed a deal with Alphabet's (GOOG, GOOGL) Google ( GOOG ), offering customers the choice to combine the Oracle cloud infrastructure and Google ( GOOG ) cloud technologies to speed up application migrations and modernization. The financial terms of both agreements weren't disclosed.

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