Oracle Corporation ( ORCL ) has declared a significant reduction in its database software and cloud-computing service prices for the federal government

What Happened: Oracle is offering a 75% discount on its license-based software — including databases and analytics tools — to government agencies. Additionally, the company is offering a “substantial” discount on its cloud service until the end of November, as stated by the General Services Administration (GSA), detailed by The Wall Street Journal.

The GSA, which handles procurement for the federal government, revealed that its agreement with Oracle is the first of its kind to provide a government-wide discount on cloud infrastructure. The agency is also in talks with other cloud providers to explore the possibility of securing similar agreements.

Oracle's agreement also includes granting the federal government access to its AI services and offering specialized support for migrating IT systems to the cloud. Traditionally recognized for its database software, the company has recently expanded its government collaborations, launching a new program last month to help smaller vendors sell technology to the Defense Department.

The GSA aims to achieve these savings by negotiating directly with tech companies and bypassing third parties. The agency anticipates securing longer-term discounts with tech providers in the near future.

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Why It Matters: Oracle’s recent move aligns with its strong performance over the past month, as the company’s shares soared by more than 30%. The company kicked off June with robust fourth-quarter earnings, surpassing estimates.

Oracle’s CEO, Safra Catz, noted a “strong start” to fiscal 2026, with the company’s MultiCloud database revenue experiencing over 100% growth. This growth trajectory, coupled with Oracle’s strategic edge in the global AI race, may have influenced the company’s decision to offer these unprecedented discounts to the U.S. government.

During its fourth quarter earnings results, Oracle’s Chairman, Larry Ellison, highlighted the company’s competitive strength in its deep integration inside enterprise data architecture, a factor that allows it to compete successfully against other giants in the AI space.

On a year-to-date basis, oracle stock surged 42.94%, as per Benzinga Pro.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.