1、 Table of Contents UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549 FORM 10-QQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended February 28,2025orTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EX

2、CHANGE ACT OF 1934For the transi?on period from _ to _Commission File Number:001-35992 Oracle Corpora?on(Exact name of registrant as specified in its charter)Delaware 54-2185193(State or other jurisdic?on ofincorpora?on or organiza?on)(I.R.S.EmployerIden?fica?on No.)2300 Oracle WayAus?n,Texas 78741(

3、Address of principal execu?ve offices)(Zip Code)(737)867-1000(Registrants telephone number,including area code)Securi?es registered pursuant to Sec?on 12(b)of the Act:Title of each classTrading Symbol(s)Name of each exchange on which registeredCommon Stock,par value$0.01 per share 3.125%senior notes

4、 due July 2025 ORCLNew York Stock Exchange New York Stock Exchange Indicate by check mark whether the registrant(1)has filed all reports required to be filed by Sec?on 13 or 15(d)of the Securi?es Exchange Act of 1934 during the preceding 12 months(or for such shorter period that the registrant was r

5、equired to file such reports),and(2)has been subject to such filing requirements for the past 90 days.Yes No Indicate by check mark whether the registrant has submi?ed electronically every Interac?ve Data File required to be submi?ed pursuant to Rule 405 of Regula?on S-T(232.405 of this chapter)duri

6、ng the preceding 12 months(or for such shorter period that the registrant was required to submit such files).Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a smaller repor?ng company or an emerging growth company.See the

7、 defini?ons of“large accelerated filer,”“accelerated filer,”“smaller repor?ng company”and“emerging growth company”in Rule 12b-2 of the Exchange Act.Large accelerated filer Accelerated filer Non-accelerated filer Smaller repor?ng company Emerging growth company If an emerging growth company,indicate

8、by check mark if the registrant has elected not to use the extended transi?on period for complying with any new or revised financial accoun?ng standards provided pursuant to Sec?on 13(a)of the Exchange Act.Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of t

9、he Exchange Act).Yes No The number of shares of registrants common stock outstanding as of March 7,2025 was:2,804,234,000.Table of ContentsORACLE CORPORATIONFORM 10-Q QUARTERLY REPORT TABLE OF CONTENTS Page PART I.FINANCIAL INFORMATION 3 Item 1.Financial Statements(Unaudited)3 Condensed Consolidated

10、 Balance Sheets as of February 28,2025 and May 31,2024 3 Condensed Consolidated Statements of Opera?ons for the Three and Nine Months Ended February 28,2025 and February 29,2024 4 Condensed Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended February 28,2025 and Febru

11、ary 29,2024 5 Condensed Consolidated Statements of Stockholders Equity for the Three and Nine Months Ended February 28,2025 and February 29,2024 6 Condensed Consolidated Statements of Cash Flows for the Nine Months Ended February 28,2025 and February 29,2024 7 Notes to Condensed Consolidated Financi

12、al Statements 8 Item 2.Managements Discussion and Analysis of Financial Condi?on and Results of Opera?ons 22 Item 3.Quan?ta?ve and Qualita?ve Disclosures About Market Risk 40 Item 4.Controls and Procedures 40 PART II.OTHER INFORMATION 41 Item 1.Legal Proceedings 41 Item 1A.Risk Factors 41 Item 2.Unr

13、egistered Sales of Equity Securi?es and Use of Proceeds 41 Item 5.Other Informa?on 42 Item 6.Exhibits 43 Signatures 45 1Table of ContentsCau?onary Note on Forward-Looking StatementsFor purposes of this Quarterly Report on Form 10-Q(this Quarterly Report),the terms“Oracle,”“we,”“us”and“our”refer to O

14、racle Corpora?on and its consolidated subsidiaries.This Quarterly Report contains statements that are not historical in nature,are predic?ve in nature,or that depend upon or refer to future events or condi?ons or otherwise contain forward-looking statements within the meaning of Sec?on 21E of the Se

15、curi?es Exchange Act of 1934,as amended(the Exchange Act),and Sec?on 27A of the Securi?es Act of 1933,as amended(the Securi?es Act).These include,among other things,statements regarding:our expecta?on that we may acquire,and realize the an?cipated benefits of acquiring,companies,products,services an

16、d technologies to further our corporate strategy as compelling opportuni?es become available;our expecta?on that,on a constant currency basis,our total cloud and license revenues generally will con?nue to increase due to expected growth in our cloud services and con?nued demand for our cloud license

17、 and on-premise license and license support offerings;our expecta?on that substan?ally all of our customers will renew their license support contracts upon expira?on;our expecta?on that current and expected customer demand will require con?nued growth in our cloud services and license support expens

18、es in order to increase our exis?ng data center capacity and establish addi?onal data centers in new geographic loca?ons;our expecta?on that our hardware business will have lower opera?ng margins as a percentage of revenues than our cloud and license business;our expecta?on that we will con?nue to m

19、ake significant investments in research and development to maintain and improve our current products and service offerings,and our belief that research and development efforts are essen?al to maintaining our compe?ve posi?on;our expecta?ons regarding the financial performance and long-term poten?al

20、of one of our investment companies;our expecta?on that our interna?onal opera?ons will con?nue to provide a significant por?on of our total revenues and expenses;our expecta?on that the propor?on of our cloud services revenues rela?ve to our total revenues will con?nue to increase;the sufficiency of

21、 our sources of funding for working capital,capital expenditures,contractual obliga?ons,acquisi?ons,dividends,stock repurchases,debt repayments and other ma?ers;our belief that we have adequately provided under United States(U.S.)generally accepted accoun?ng principles for outcomes related to our ta

22、x audits,that the final outcome of our tax-related examina?ons,agreements or judicial proceedings will not have a material effect on our results of opera?ons,and that our net deferred tax assets will likely be realized in the foreseeable future;our belief that the outcome of certain legal proceeding

23、s and claims to which we are a party will not,individually or in the aggregate,result in losses that are materially in excess of amounts already recognized,if any;the possibility that certain legal proceedings to which we are a party could have a material impact on our financial posi?on or results o

24、f opera?ons;the?ming and amount of expenses we expect to incur;the cost savings we expect to realize pursuant to the Fiscal 2024 Oracle Restructuring Plan;2Table of Contentsdeclara?ons and amounts of future cash dividend payments and the?ming and amount of future stock repurchases,including our expe

25、cta?on that the levels of our future stock repurchase ac?vity may be modified in comparison to past periods in order to use available cash for other purposes;our ability to predict revenues,par?cularly certain cloud license and on-premise license revenues and hardware revenues;the percentages of rem

26、aining performance obliga?ons that we expect to recognize as revenues over respec?ve future periods;as well as other statements regarding our future opera?ons,financial condi?on and prospects,and business strategies.Forward-looking statements may be preceded by,followed by or include the words“an?ci

27、pates,”“believes,”“commits,”“con?nues,”“could,”“endeavors,”“es?mates,”“expects,”“future,”“goal,”“intends,”“is designed to,”“likely,”“maintains,”“may,”“plans,”“poten?al,”“seeks,”“shall,”“should,”“strives,”“will”and similar expressions.We claim the protec?on of the safe harbor for forward-looking stat

28、ements contained in the Exchange Act and the Securi?es Act for all forward-looking statements.We have based these forward-looking statements on our current expecta?ons and projec?ons about future events.These forward-looking statements are subject to risks,uncertain?es and assump?ons about our busin

29、ess that could affect our future results and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements.Factors that might cause or contribute to such differences include,but are not limited to,those discussed in“Risk Factors”in

30、cluded in documents we file from?me to?me with the U.S.Securi?es and Exchange Commission,including our Annual Report on Form 10-K for the fiscal year ended May 31,2024 and our other Quarterly Reports on Form 10-Q filed by us in our fiscal year 2025,which runs from June 1,2024 to May 31,2025.We have

31、no obliga?on to publicly update or revise any forward-looking statements,whether as a result of new informa?on,future events or risks,except to the extent required by applicable securi?es laws.If we do update one or more forward-looking statements,no inference should be drawn that we will make addi?

32、onal updates with respect to those or other forward-looking statements.New informa?on,future events or risks could cause the forward-looking events we discuss in this Quarterly Report not to occur.You should not place undue reliance on these forward-looking statements,which reflect our expecta?ons o

33、nly as of the date of this Quarterly Report.3Table of ContentsPART I.FINANCIAL INFORMATIONItem 1.Financial Statements(Unaudited)ORACLE CORPORATIONCONDENSED CONSOLIDATED BALANCE SHEETSAs of February 28,2025 and May 31,2024(Unaudited)(in millions,except per share data)February 28,2025 May 31,2024 ASSE

34、TS Current assets:Cash and cash equivalents$17,406$10,454 Marketable securi?es 417 207 Trade receivables,net of allowances for credit losses of$556 and$485 as of February 28,2025 and May 31,2024,respec?vely 8,051 7,874 Prepaid expenses and other current assets 4,242 4,019 Total current assets 30,116

35、 22,554 Non-current assets:Property,plant and equipment,net 31,970 21,536 Intangible assets,net 5,131 6,890 Goodwill,net 62,171 62,230 Deferred tax assets 11,799 12,273 Other non-current assets 20,191 15,493 Total non-current assets 131,262 118,422 Total assets$161,378$140,976 LIABILITIES AND STOCKH

36、OLDERS EQUITY Current liabili?es:Notes payable and other borrowings,current$8,167$10,605 Accounts payable 2,423 2,357 Accrued compensa?on and related benefits 1,839 1,916 Deferred revenues 9,019 9,313 Other current liabili?es 8,175 7,353 Total current liabili?es 29,623 31,544 Non-current liabili?es:

37、Notes payable and other borrowings,non-current 88,109 76,264 Income taxes payable 9,813 10,817 Deferred tax liabili?es 2,208 3,692 Other non-current liabili?es 14,364 9,420 Total non-current liabili?es 114,494 100,193 Commitments and con?ngencies Oracle Corpora?on stockholders equity:Preferred stock

38、,$0.01 par valueauthorized:1.0 shares;outstanding:none Common stock,$0.01 par value and addi?onal paid in capitalauthorized:11,000 shares;outstanding:2,803 shares and 2,755 shares as of February 28,2025 and May 31,2024,respec?vely 35,691 32,764 Accumulated deficit (17,368)(22,628)Accumulated other c

39、omprehensive loss (1,593)(1,432)Total Oracle Corpora?on stockholders equity 16,730 8,704 Noncontrolling interests 531 535 Total stockholders equity 17,261 9,239 Total liabili?es and stockholders equity$161,378$140,976 See notes to condensed consolidated financial statements.4Table of ContentsORACLE

40、CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONSFor the Three and Nine Months Ended February 28,2025 and February 29,2024(Unaudited)Three Months Ended Nine Months Ended(in millions,except per share data)February 28,2025 February 29,2024 February 28,2025 February 29,2024 Revenues:Cloud serv

41、ices and license support$11,007$9,963$32,331$29,149 Cloud license and on-premise license 1,129 1,256 3,194 3,243 Hardware 703 754 2,086 2,224 Services 1,291 1,307 3,885 4,058 Total revenues 14,130 13,280 41,496 38,674 Opera?ng expenses:Cloud services and license support 2,882 2,452 8,226 6,905 Hardw

42、are 197 217 530 649 Services 1,116 1,200 3,430 3,665 Sales and marke?ng 2,119 2,042 6,345 6,161 Research and development 2,429 2,248 7,206 6,689 General and administra?ve 390 377 1,135 1,146 Amor?za?on of intangible assets 548 749 1,763 2,267 Acquisi?on related and other 28 155 72 214 Restructuring

43、63 90 220 311 Total opera?ng expenses 9,772 9,530 28,927 28,007 Opera?ng income 4,358 3,750 12,569 10,667 Interest expense (892)(876)(2,600)(2,636)Non-opera?ng(expenses)income,net (18)(9)39 (72)Income before income taxes 3,448 2,865 10,008 7,959 Provision for income taxes 512 464 992 636 Net income$

44、2,936$2,401$9,016$7,323 Earnings per share:Basic$1.05$0.87$3.24$2.67 Diluted$1.02$0.85$3.15$2.60 Weighted average common shares outstanding:Basic 2,799 2,748 2,783 2,741 Diluted 2,874 2,819 2,865 2,820 Exclusive of amor?za?on of intangible assets,which is shown separately.See notes to condensed cons

45、olidated financial statements.(1)(1)(1)(1)(1)5Table of ContentsORACLE CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMEFor the Three and Nine Months Ended February 28,2025 and February 29,2024(Unaudited)Three Months Ended Nine Months Ended(in millions)February 28,2025 February 29,

46、2024 February 28,2025 February 29,2024 Net income$2,936$2,401$9,016$7,323 Other comprehensive(loss)income,net of tax:Net foreign currency transla?on(losses)gains (54)(35)(51)7 Net unrealized(losses)gains on cash flow hedges (19)(3)(107)52 Other,net (1)(1)(3)(3)Total other comprehensive(loss)income,n

47、et (74)(39)(161)56 Comprehensive income$2,862$2,362$8,855$7,379 See notes to condensed consolidated financial statements.6Table of ContentsORACLE CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITYFor the Three and Nine Months Ended February 28,2025 and February 29,2024(Unaudited)Thr

48、ee Months Ended Nine Months Ended(in millions,except per share data)February 28,2025 February 29,2024 February 28,2025 February 29,2024 Common stock and addi?onal paid in capital Balance,beginning of period$34,310$30,724$32,764$30,215 Common stock issued 213 28 520 454 Stock-based compensa?on 1,198

49、1,048 3,374 2,927 Repurchases of common stock (10)(46)(34)(103)Shares repurchased for tax withholdings upon ves?ng of restricted stock-based awards (1)(132)(900)(1,865)Other,net (19)(33)(6)Balance,end of period$35,691$31,622$35,691$31,622 Accumulated deficit Balance,beginning of period$(19,045)$(25,

50、431)$(22,628)$(27,620)Repurchases of common stock (140)(404)(416)(947)Cash dividends declared (1,119)(1,099)(3,340)(3,289)Net income 2,936 2,401 9,016 7,323 Balance,end of period$(17,368)$(24,533)$(17,368)$(24,533)Other stockholders equity,net Balance,beginning of period$(1,029)$(915)$(897)$(1,039)O

51、ther comprehensive(loss)income,net (74)(39)(161)56 Other,net 41 47 (4)76 Balance,end of period$(1,062)$(907)$(1,062)$(907)Total stockholders equity$17,261$6,182$17,261$6,182 Cash dividends declared per common share$0.40$0.40$1.20$1.20 See notes to condensed consolidated financial statements.7Table o

52、f ContentsORACLE CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWSFor the Nine Months Ended February 28,2025 and February 29,2024(Unaudited)Nine Months Ended(in millions)February 28,2025 February 29,2024 Cash flows from opera?ng ac?vi?es:Net income$9,016$7,323 Adjustments to reconcile net i

53、ncome to net cash provided by opera?ng ac?vi?es:Deprecia?on 2,715 2,318 Amor?za?on of intangible assets 1,763 2,267 Deferred income taxes (1,097)(1,755)Stock-based compensa?on 3,374 2,927 Other,net 422 631 Changes in opera?ng assets and liabili?es:Increase in trade receivables,net (312)(409)Decrease

54、 in prepaid expenses and other assets 603 457 Decrease in accounts payable and other liabili?es (633)(682)Decrease in income taxes payable (1,222)(788)Increase in deferred revenues 35 303 Net cash provided by opera?ng ac?vi?es 14,664 12,592 Cash flows from inves?ng ac?vi?es:Purchases of marketable s

55、ecuri?es and other investments (838)(674)Proceeds from sales and maturi?es of marketable securi?es and other investments 444 207 Acquisi?ons,net of cash acquired (59)Capital expenditures (12,135)(4,068)Net cash used for inves?ng ac?vi?es (12,529)(4,594)Cash flows from financing ac?vi?es:Payments for

56、 repurchases of common stock (450)(1,050)Proceeds from issuances of common stock 520 454 Shares repurchased for tax withholdings upon ves?ng of restricted stock-based awards (900)(1,865)Payments of dividends to stockholders (3,340)(3,289)(Repayments of)proceeds from issuances of commercial paper,net

57、 (396)936 Proceeds from issuances of senior notes and term loan credit agreements,net of issuance costs 19,548 Repayments of senior notes and term loan credit agreements (9,771)(3,500)Other,net (299)34 Net cash provided by(used for)financing ac?vi?es 4,912 (8,280)Effect of exchange rate changes on c

58、ash and cash equivalents (95)(2)Net increase(decrease)in cash and cash equivalents 6,952 (284)Cash and cash equivalents at beginning of period 10,454 9,765 Cash and cash equivalents at end of period$17,406$9,481 Non-cash inves?ng ac?vi?es:Unpaid capital expenditures$1,846$941 See notes to condensed

59、consolidated financial statements.8Table of ContentsORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTSFebruary 28,2025(Unaudited)1.BASIS OF PRESENTATION,RECENT ACCOUNTING PRONOUNCEMENTS AND OTHERBasis of Presenta?onWe have prepared the condensed consolidated financial statements

60、included herein pursuant to the rules and regula?ons of the U.S.Securi?es and Exchange Commission(the SEC).Certain informa?on and footnote disclosures normally included in financial statements prepared in accordance with U.S.generally accepted accoun?ng principles(GAAP)have been condensed or omi?ed

61、pursuant to such rules and regula?ons.However,we believe that the disclosures herein are adequate to ensure the informa?on presented is not misleading.These unaudited condensed consolidated financial statements should be read in conjunc?on with the audited consolidated financial statements and the n

62、otes thereto included in our Annual Report on Form 10-K for the fiscal year ended May 31,2024.We believe that all necessary adjustments,which consisted only of normal recurring items,have been included in the accompanying financial statements to present fairly the results of the interim periods.The

63、results of opera?ons for the interim periods presented are not necessarily indica?ve of the opera?ng results to be expected for any subsequent interim period or for the fiscal year ending May 31,2025.There have been no changes to our significant accoun?ng policies as disclosed in our Annual Report o

64、n Form 10-K for the fiscal year ended May 31,2024 that had a significant impact on our condensed consolidated financial statements or notes thereto as of and for the nine months ended February 28,2025.Use of Es?matesOur condensed consolidated financial statements are prepared in accordance with GAAP

65、 as set forth in the Financial Accoun?ng Standards Boards(FASB)Accoun?ng Standards Codifica?on(ASC),and we consider various staff accoun?ng bulle?ns and other applicable guidance issued by the SEC.These accoun?ng principles require us to make certain es?mates,judgments and assump?ons.We believe that

66、 the es?mates,judgments and assump?ons upon which we rely are reasonable based upon informa?on available to us at the?me that these es?mates,judgments and assump?ons are made.These es?mates,judgments and assump?ons can affect the reported amounts of assets and liabili?es as of the date of the financ

67、ial statements as well as the reported amounts of revenues and expenses during the periods presented.To the extent that there are differences between these es?mates,judgments or assump?ons and actual results,our consolidated financial statements will be affected.In many cases,the accoun?ng treatment

68、 of a par?cular transac?on is specifically dictated by GAAP and does not require managements judgment in its applica?on.There are also areas in which managements judgment in selec?ng among available alterna?ves would not produce a materially different result.During the first quarter of fiscal 2025,w

69、e completed an assessment of the useful lives of our servers and networking equipment and increased the es?mate of the useful lives from five years to six years,effec?ve at the beginning of fiscal 2025.Based on the carrying value of our servers and networking equipment as of May 31,2024,this change

70、in accoun?ng es?mate decreased our total opera?ng expenses by$181 million and increased our net income by$136 million,or$0.05 per both basic and diluted share,for the third quarter of fiscal 2025 and decreased our total opera?ng expenses by$567 million and increased our net income by$442 million,or$

71、0.16 per basic and$0.15 per diluted share,for the first nine months of fiscal 2025.Cash,Cash Equivalents and Restricted CashRestricted cash that was included within cash and cash equivalents as presented within our condensed consolidated balance sheets as of February 28,2025 and May 31,2024 and our

72、condensed consolidated statements of cash flows for the nine months ended February 28,2025 and February 29,2024 was immaterial.ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unaudited)9Table of ContentsRemaining Performance Obliga?ons from Contracts

73、with CustomersTrade receivables,net of allowance for credit losses,and deferred revenues are reported net of related uncollected deferred revenues in our condensed consolidated balance sheets as of February 28,2025 and May 31,2024.The revenues recognized during the nine months ended February 28,2025

74、 and February 29,2024 that were included in the opening deferred revenues balances as of May 31,2024 and 2023 were approximately$8.6 billion and$8.5 billion,respec?vely.Revenues recognized from performance obliga?ons sa?sfied in prior periods and impairment losses recognized on our receivables were

75、immaterial in each of the three and nine months ended February 28,2025 and February 29,2024,respec?vely.Remaining performance obliga?ons,as defined in Note 1 of Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended May 31,2024,were$130.2 bill

76、ion as of February 28,2025,of which we expect to recognize approximately 31%as revenues over the next twelve months,40%over the subsequent month 13 to month 36,25%over the subsequent month 37 to month 60 and the remainder therea?er.Sales of Financing ReceivablesWe offer certain of our customers the

77、op?on to acquire certain of our cloud and license,hardware and services offerings through separate long-term payment contracts.We generally sell these contracts that we have financed for our customers on a non-recourse basis to financial ins?tu?ons within 90 days of the contracts dates of execu?on.W

78、e record the transfers of amounts due from customers to financial ins?tu?ons as sales of financing receivables because we are considered to have surrendered control of these financing receivables.Financing receivables sold to financial ins?tu?ons were$306 million and$1.2 billion for the three and ni

79、ne months ended February 28,2025,respec?vely,and$269 million and$1.1 billion for the three and nine months ended February 29,2024,respec?vely.Non-Marketable InvestmentsAs of each of February 28,2025 and May 31,2024,our non-marketable debt investments and equity securi?es and related instruments tota

80、led$2.0 billion,and are included in other non-current assets in the accompanying condensed consolidated balance sheets and are subject to periodic credit losses and impairment reviews.Certain of these non-marketable equity securi?es and related instruments are adjusted for observable price changes f

81、rom orderly transac?ons.The majority of the non-marketable investments held as of these dates were with Ampere Compu?ng Holdings LLC(Ampere),a related party en?ty in which we have an ownership interest of approximately 29%as of February 28,2025.We follow the equity method of accoun?ng for our invest

82、ment in Ampere and our share of loss under the equity method of accoun?ng is recorded in the non-opera?ng(expenses)income,net line item in our condensed consolidated statements of opera?ons.We also have conver?ble debt investments in Ampere which,under the terms of an agreement with Ampere and other

83、 co-investors,will mature in June 2026 and are conver?ble into equity securi?es at the holders op?on under certain circumstances.During the nine months ended February 28,2025,we invested an aggregate of$225 million in conver?ble debt instruments issued by Ampere.The total carrying value of our inves

84、tments in Ampere a?er accoun?ng for losses under the equity method of accoun?ng was$1.5 billion as of February 28,2025.In accordance with the terms of an agreement with other co-investors,we are also a counterparty to certain put(exercisable by a co-investor)and call(exercisable by Oracle)op?ons at

85、prices of approximately$450 million to$1.5 billion,respec?vely,to acquire addi?onal equity interests in Ampere from our co-investors through January 2027.If either of such op?ons is exercised by us or our co-investors,we would obtain control of Ampere and consolidate its results with our results of

86、opera?ons.Ampere has historically generated net losses.LeasesWe have opera?ng and finance leases that primarily relate to certain of our data centers and facili?es.Right-of-Use(ROU)assets related to our opera?ng leases,which are included in other non-current assets in our condensed ORACLE CORPORATIO

87、NNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unaudited)10Table of Contentsconsolidated balance sheets,were$11.7 billion and$7.3 billion as of February 28,2025 and May 31,2024,respec?vely,and ROU assets related to our finance leases,which are included in property,pl

88、ant and equipment,net in our condensed consolidated balance sheets,were$894 million as of February 28,2025(and none as of May 31,2024).Lease liabili?es are included in other current liabili?es and other non-current liabili?es in our condensed consolidated balance sheets.Total opera?ng lease liabili?

89、es were$12.0 billion and$7.5 billion as of February 28,2025 and May 31,2024,respec?vely,and total finance lease liabili?es were$900 million as of February 28,2025(and none as of May 31,2024).Total opera?ng and finance lease expenses were$454 million and$324 million for the three months ended Februar

90、y 28,2025 and February 29,2024,respec?vely,and$1.2 billion and$840 million for the nine months ended February 28,2025 and February 29,2024,respec?vely.Opera?ng lease payments and interest payments on finance leases were$1.2 billion and$839 million for the nine months ended February 28,2025 and Febru

91、ary 29,2024,respec?vely.As of February 28,2025,we had$48.4 billion of addi?onal lease commitments,primarily for data centers,that are generally expected to commence between fiscal 2025 and fiscal 2027 and for terms of ten to fi?een years that were not reflected on our condensed consolidated balance

92、sheets as of February 28,2025.Acquisi?on Related and Other ExpensesAcquisi?on related and other expenses primarily consist of personnel related costs for transi?onal and certain other employees,certain business combina?on adjustments,including adjustments a?er the measurement period has ended,and ce

93、rtain other opera?ng items,net.Three Months Ended Nine Months Ended(in millions)February 28,2025 February 29,2024 February 28,2025 February 29,2024 Transi?onal and other employee related costs$5$3$17 Business combina?on adjustments,net 1 4 (4)17 Other,net 27 146 73 180 Total acquisi?on related and o

94、ther expenses$28$155$72$214 Non-Opera?ng(Expenses)Income,netNon-opera?ng(expenses)income,net consists primarily of interest income,net foreign currency exchange losses,the noncontrolling interests in the net profits of our majority-owned subsidiaries(primarily Oracle Financial Services So?ware Limit

95、ed and Oracle Corpora?on Japan),net losses related to marketable and non-marketable investments,including losses a?ributable to equity method investments(primarily Ampere)and net other income and expenses,including net unrealized gains and losses from our investment por?olio related to our deferred

96、compensa?on plan and non-service net periodic pension income and losses.ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unaudited)11Table of Contents Three Months Ended Nine Months Ended(in millions)February 28,2025 February 29,2024 February 28,2025 F

97、ebruary 29,2024 Interest income$135$111$418$380 Foreign currency losses,net (37)(59)(96)(172)Noncontrolling interests in income (48)(51)(138)(130)Losses from marketable and non-marketable investments,net (59)(94)(236)(290)Other(expenses)income,net (9)84 91 140 Total non-opera?ng(expenses)income,net$

98、(18)$(9)$39$(72)Recent Accoun?ng PronouncementsSegment Repor?ng:In November 2023,the FASB issued ASU 2023-07,Segment Repor?ng(Topic 280):Improvements to Reportable Segment Disclosures(ASU 2023-07),which enhances the disclosures required for opera?ng segments in our annual and interim consolidated fi

99、nancial statements.ASU 2023-07 is effec?ve for us for our annual repor?ng for fiscal 2025 and for interim period repor?ng beginning in fiscal 2026 on a retrospec?ve basis.Early adop?on is permi?ed.We are currently evalua?ng the impact of our pending adop?on of ASU 2023-07 on our consolidated financi

100、al statements.Income Taxes:In December 2023,the FASB issued ASU 2023-09,Income Taxes(Topic 740):Improvements to Income Tax Disclosures(ASU 2023-09),which enhances the disclosures required for income taxes in our annual consolidated financial statements.ASU 2023-09 is effec?ve for us for our annual r

101、epor?ng for fiscal 2026 on a prospec?ve basis.Both early adop?on and retrospec?ve applica?on are permi?ed.We are currently evalua?ng the impact of our pending adop?on of ASU 2023-09 on our consolidated financial statements.Income Statement:In November 2024,the FASB issued ASU 2024-03,Income Statemen

102、tRepor?ng Comprehensive IncomeExpense Disaggrega?on Disclosures(Subtopic 220-40):Disaggrega?on of Income Statement Expenses(ASU 2024-03)and also issued subsequent guidance clarifying the effec?ve date of the ini?al guidance(collec?vely Subtopic 220-40),which enhances the disclosures required for exp

103、ense disaggrega?on in our annual and interim consolidated financial statements.This guidance is effec?ve for us for our annual repor?ng for fiscal 2028 and for interim period repor?ng beginning in fiscal 2029 on a prospec?ve basis.Both early adop?on and retrospec?ve applica?on are permi?ed.We are cu

104、rrently evalua?ng the impact of our pending adop?on of Subtopic 220-40 on our consolidated financial statements.2.FAIR VALUE MEASUREMENTSWe perform fair value measurements in accordance with FASB ASC 820,Fair Value Measurement(ASC 820).ASC 820 defines fair value as the price that would be received f

105、rom selling an asset or paid to transfer a liability in an orderly transac?on between market par?cipants at the measurement date.When determining the fair value measurements for assets and liabili?es required to be recorded at their fair values,we consider the principal or most advantageous market i

106、n which we would transact and consider assump?ons that market par?cipants would use when pricing the assets or liabili?es,such as inherent risk,transfer restric?ons and risk of nonperformance.ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unaudited)1

107、2Table of ContentsASC 820 establishes a fair value hierarchy that requires an en?ty to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.An assets or a liabilitys categoriza?on within the fair value hierarchy is based upon the lowest level of

108、 input that is significant to the fair value measurement.ASC 820 establishes three levels of inputs that may be used to measure fair value:Level 1:quoted prices in ac?ve markets for iden?cal assets or liabili?es;Level 2:inputs other than Level 1 that are observable,either directly or indirectly,such

109、 as quoted prices in ac?ve markets for similar assets or liabili?es,quoted prices for iden?cal or similar assets or liabili?es in markets that are not ac?ve,or other inputs that are observable or can be corroborated by observable market data for substan?ally the full term of the assets or liabili?es

110、;orLevel 3:unobservable inputs that are supported by li?le or no market ac?vity and that are significant to the fair values of the assets or liabili?es.Assets and Liabili?es Measured at Fair Value on a Recurring BasisOur assets and liabili?es measured at fair value on a recurring basis consisted of

111、the following(Level 1 and Level 2 inputs are defined above):February 28,2025 May 31,2024 Fair Value MeasurementsUsing Input Types Fair Value MeasurementsUsing Input Types (in millions)Level 1 Level 2 Total Level 1 Level 2 Total Assets:Money market funds$9,927$9,927$2,620$2,620 Time deposits and othe

112、r 50 512 562 48 262 310 Deriva?ve financial instruments 72 72 179 179 Total assets$9,977$584$10,561$2,668$441$3,109 Liabili?es:Deriva?ve financial instruments$93$93$96$96 Our cash equivalents and marketable securi?es investments consist of money market funds,?me deposits and marketable equity securi

113、?es.Marketable securi?es as presented per our condensed consolidated balance sheets included debt securi?es with original maturi?es at the?me of purchase greater than three months and the remainder of the debt securi?es were included in cash and cash equivalents.We classify our marketable debt secur

114、i?es as available-for-sale debt securi?es at the?me of purchase and reevaluate such classifica?on as of each balance sheet date.As of February 28,2025 and May 31,2024,all of our marketable debt securi?es investments mature within one year.Our valua?on techniques used to measure the fair values of ou

115、r instruments that were classified as Level 1 in the table above were derived from quoted market prices and ac?ve markets for these instruments that exist.Our valua?on techniques used to measure the fair values of Level 2 instruments listed in the table above were derived from the following:non-bind

116、ing market consensus prices that were corroborated by observable market data,quoted market prices for similar instruments,or pricing models,such as discounted cash flow techniques,with all significant inputs derived from or corroborated by observable market data including reference rate yield curves

117、,among others.Based on the trading prices of the$96.3 billion and$86.5 billion of senior notes and other long-term borrowings and the related fair value hedges that we had outstanding as of February 28,2025 and May 31,2024,respec?vely,the es?mated fair values of the senior notes and other long-term

118、borrowings and the related fair value hedges using Level 2 inputs at February 28,2025 and May 31,2024 were$88.8 billion and$77.2 billion,respec?vely.ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unaudited)13Table of Contents3.NOTES PAYABLE AND OTHER

119、 BORROWINGSSenior NotesIn the first nine months of fiscal 2025,we issued$14.0 billion,par value,of senior notes comprised of the following:February 28,2025(Dollars in millions)Date ofIssuance Amount Effec?ve Interest RateFixed-rate senior notes:$1,500,4.80%,due August 2028 February 2025$1,500 4.94%$

120、1,500,4.20%,due September 2029 September 2024 1,500 4.27%$1,250,5.25%,due February 2032 February 2025 1,250 5.36%$1,750,4.70%,due September 2034 September 2024 1,750 4.77%$1,750,5.50%,due August 2035 February 2025 1,750 5.55%$1,750,5.375%,due September 2054 September 2024 1,750 5.43%$1,750,6.00%,due

121、 August 2055 February 2025 1,750 6.04%$1,250,5.50%,due September 2064 September 2024 1,250 5.55%$1,000,6.125%,due August 2065 February 2025 1,000 6.17%Floa?ng-rate senior notes:$500,Compounded SOFR plus 0.76%,due August 2028 February 2025 500 5.28%Total senior notes$14,000 Unamor?zed discount/issuan

122、ce costs (77)Total senior notes,net$13,923 We issued the senior notes to repay all or a por?on of senior notes due between November 2024 and July 2026,and to pay accrued interest and any related premiums,fees and expenses in connec?on therewith;to make scheduled payments of principal and interest on

123、 borrowings under a term loan credit agreement executed in June 2024;to repay all or a por?on of commercial paper notes outstanding;and to use any remaining net proceeds from the borrowing for general corporate purposes,which may include stock repurchases,payment of cash dividends on our common stoc

124、k,repayment of other indebtedness and future acquisi?ons.The interest is payable semi-annually for the fixed-rate senior notes and quarterly for the floa?ng-rate senior notes.We may redeem some or all of the fixed-rate senior notes of each series prior to their maturity,subject to certain restric?on

125、s,and the payment of an applicable make-whole premium in certain instances.The senior notes rank pari passu with any other exis?ng and future unsecured and unsubordinated indebtedness of Oracle.All exis?ng and future indebtedness and liabili?es of the subsidiaries of Oracle are or will be effec?vely

126、 senior to the senior notes.We were in compliance with all senior notes-related covenants as of February 28,2025.The material terms and condi?ons of the senior notes are set forth in,and the foregoing descrip?on of the senior notes is qualified in its en?rety by reference to,the Officers Cer?ficates

127、 filed as Exhibit 4.1 to Oracles Current Report on Form 8-K filed on September 27,2024 and filed herewith as Exhibit 4.01 and incorporated by reference herein.There have been no other significant changes in our notes payable or other borrowing arrangements that were disclosed in our Annual Report on

128、 Form 10-K for the fiscal year ended May 31,2024.ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unaudited)14Table of Contents4.RESTRUCTURING ACTIVITIESFiscal 2024 Oracle Restructuring PlanDuring fiscal 2024,our management approved,commi?ed to and ini

129、?ated plans to restructure and further improve efficiencies in our opera?ons due to our acquisi?ons and certain other opera?onal ac?vi?es(2024 Restructuring Plan).In the first nine months of fiscal 2025,our management supplemented the 2024 Restructuring Plan to reflect addi?onal ac?ons that we expec

130、t to take.The total es?mated restructuring costs associated with the 2024 Restructuring Plan are up to$679 million and will be recorded to the restructuring expense line item within our condensed consolidated statements of opera?ons as they are incurred through the end of the plan.We recorded$227 mi

131、llion and$336 million of restructuring expenses in connec?on with the 2024 Restructuring Plan during the nine months ended February 28,2025 and February 29,2024,respec?vely.Any changes to the es?mates of execu?ng the 2024 Restructuring Plan will be reflected in our future results of opera?ons.Summar

132、y of All Plans Accrued Nine Months Ended February 28,2025 Accrued TotalCosts TotalExpected(in millions)May 31,2024 Ini?alCosts Adj.toCost CashPayments Others February 28,2025 Accruedto Date ProgramCosts 2024 Restructuring Plan Cloud and license$87$78$(4)$(90)$(2)$69$269$273 Hardware 4 7 (6)5 16 20 S

133、ervices 12 29 (19)22 74 77 Other 49 118 (1)(110)56 300 309 Total 2024 Restructuring Plan$152$232$(5)$(225)$(2)$152$659$679 Total other restructuring plans$84$(7)$(24)$(1)$52 Total restructuring plans$236$232$(12)$(249)$(3)$204 Restructuring costs recorded to each of the opera?ng segments presented p

134、rimarily related to employee severance costs.Other restructuring costs represented employee severance costs not related to our opera?ng segments and certain other restructuring plan costs.As of February 28,2025 and May 31,2024,substan?ally all restructuring liabili?es have been recorded in other cur

135、rent liabili?es within our condensed consolidated balance sheets.Costs recorded for the respec?ve restructuring plans during the period presented.All plan adjustments were changes in es?mates whereby increases and decreases in costs were generally recorded to opera?ng expenses in the period of adjus

136、tments.Represents foreign currency transla?on and certain other non-cash adjustments.Other restructuring plans presented in the tables above included condensed informa?on for other Oracle based plans and other plans associated with certain of our acquisi?ons whereby we con?nued to make cash outlays

137、to se?le obliga?ons under these plans during the periods presented but for which the periodic impact to our condensed consolidated statements of opera?ons was not significant.(2)(3)(4)(5)(2)(1)(6)(1)(2)(3)(4)(5)(6)ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)Februa

138、ry 28,2025(Unaudited)15Table of Contents5.DEFERRED REVENUESDeferred revenues consisted of the following:(in millions)February 28,2025 May 31,2024 Cloud services and license support$8,048$8,203 Hardware 559 546 Services 372 512 Cloud license and on-premise license 40 52 Deferred revenues,current 9,01

139、9 9,313 Deferred revenues,non-current(in other non-current liabili?es)1,349 1,233 Total deferred revenues$10,368$10,546 Deferred cloud services and license support revenues and deferred hardware revenues substan?ally represent customer payments made in advance for cloud or support contracts that are

140、 typically billed in advance with corresponding revenues generally being recognized ratably or based upon customer usage over the respec?ve contractual periods.Deferred services revenues include prepayments for our services business and revenues for these services are generally recognized as the ser

141、vices are performed.Deferred cloud license and on-premise license revenues typically resulted from customer payments that related to undelivered products and services or specified enhancements.6.STOCKHOLDERS EQUITYCommon Stock RepurchasesOur Board of Directors has approved a program for us to repurc

142、hase shares of our common stock.As of February 28,2025,approximately$6.5 billion remained available for stock repurchases pursuant to our stock repurchase program.We repurchased 2.9 million shares for$450 million during the nine months ended February 28,2025 and 9.4 million shares for$1.1 billion du

143、ring the nine months ended February 29,2024 under the stock repurchase program.Our stock repurchase authoriza?on does not have an expira?on date and the pace of our repurchase ac?vity will depend on factors such as our working capital needs,our cash requirements for acquisi?ons and dividend payments

144、,our debt repayment obliga?ons or repurchases of our debt,our stock price and economic and market condi?ons.Our stock repurchases may be effected from?me to?me through open market purchases or pursuant to a Rule 10b5-1 trading plan.Our stock repurchase program may be accelerated,suspended,delayed or

145、 discon?nued at any?me.Dividends on Common StockIn March 2025,our Board of Directors declared a quarterly cash dividend of$0.50 per share of our outstanding common stock,an increase of$0.10 per share over the dividend declared in December 2024.The dividend is payable on April 23,2025 to stockholders

146、 of record as of the close of business on April 10,2025.Future declara?ons of dividends and the establishment of future record and payment dates are subject to the final determina?on of our Board of Directors.Fiscal 2025 Stock-Based Awards Ac?vity and Compensa?on ExpenseDuring the first nine months

147、of fiscal 2025,we issued 35 million restricted stock-based units(RSUs),substan?ally all of which were part of our annual stock-based award process and are subject to service-based ves?ng restric?ons.ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unau

148、dited)16Table of ContentsThese fiscal 2025 stock-based award issuances were par?ally offset by stock-based award forfeitures and cancella?ons of 5 million shares during the first nine months of fiscal 2025.The RSUs that were granted during the nine months ended February 28,2025 have substan?ally sim

149、ilar ves?ng restric?ons and contractual lives and were valued using methodologies of a similar nature as those described in Note 12 of Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended May 31,2024.Stock-based compensa?on expense is includ

150、ed in the following opera?ng expense line items in our condensed consolidated statements of opera?ons:Three Months Ended Nine Months Ended(in millions)February 28,2025 February 29,2024 February 28,2025 February 29,2024 Cloud services and license support$160$138$459$386 Hardware 8 6 21 17 Services 54

151、 45 150 123 Sales and marke?ng 200 179 556 488 Research and development 675 584 1,902 1,642 General and administra?ve 101 96 286 271 Total stock-based compensa?on$1,198$1,048$3,374$2,927 7.INCOME TAXESOur effec?ve tax rates for each of the periods presented are the result of the mix of income earned

152、 and losses incurred in various tax jurisdic?ons that apply a broad range of income tax rates.Our provision for income taxes varied from the tax computed at the U.S.federal statutory income tax rate for the periods presented primarily due to earnings in foreign opera?ons,state taxes,the U.S.research

153、 and development tax credit,se?lements with tax authori?es,the tax effects of stock-based compensa?on,the Foreign Derived Intangible Income deduc?on and the tax effect of Global Intangible Low-Taxed Income.Our effec?ve tax rates were 14.9%and 9.9%for the three and nine months ended February 28,2025,

154、respec?vely,and 16.2%and 8.0%for the three and nine months ended February 29,2024,respec?vely.Our net deferred tax assets were$9.6 billion and$8.6 billion as of February 28,2025 and May 31,2024,respec?vely.We believe that it is more likely than not that the net deferred tax assets will be realized i

155、n the foreseeable future.Realiza?on of our net deferred tax assets is dependent upon our genera?on of sufficient taxable income in future years in appropriate tax jurisdic?ons to obtain benefit from the reversal of temporary differences,net opera?ng loss carryforwards and tax credit carryforwards.Th

156、e amount of net deferred tax assets considered realizable is subject to adjustment in future periods if es?mates of future taxable income change.Domes?cally,U.S.federal and state taxing authori?es are currently examining income tax returns of Oracle and various acquired en?es for years through fisca

157、l 2022.Our U.S.federal income tax returns have been examined for all years prior to fiscal 2013 and,with some excep?ons,we are no longer subject to audit for those periods.Our U.S.state income tax returns,with some excep?ons,have been examined for all years prior to fiscal 2010,and we are no longer

158、subject to audit for those periods.Interna?onally,tax authori?es for numerous non-U.S.jurisdic?ons are also examining or have examined returns of Oracle and various acquired en?es for years through fiscal 2024.Many of the relevant tax years are at an advanced stage in examina?on or subsequent contro

159、versy resolu?on processes.With some excep?ons,we are generally no longer subject to tax examina?ons in non-U.S.jurisdic?ons for years prior to fiscal 2001.ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unaudited)17Table of ContentsWe are under audit

160、by the IRS and various other domes?c and foreign tax authori?es with regards to income tax and indirect tax ma?ers and are involved in various challenges and li?ga?on in a number of countries,including,in par?cular,Australia,Brazil,Canada,Egypt,India,Indonesia,Israel,Italy,Pakistan,Saudi Arabia,Sout

161、h Korea and Spain,where the amounts under controversy are significant.In some,although not all,cases,we have reserved for poten?al adjustments to our provision for income taxes and accrual of indirect taxes that may result from examina?ons by,or any nego?ated agreements with,these tax authori?es or

162、final outcomes in judicial proceedings and we believe that the final outcome of these examina?ons,agreements or judicial proceedings will not have a material effect on our results of opera?ons.If events occur which indicate payment of these amounts is unnecessary,the reversal of the liabili?es would

163、 result in the recogni?on of benefits in the period we determine the liabili?es are no longer necessary.If our es?mates of the federal,state and foreign income tax liabili?es and indirect tax liabili?es are less than the ul?mate assessment,it could result in a further charge to expense.We believe th

164、at we have adequately provided under GAAP for outcomes related to our tax audits.However,there can be no assurances as to the possible outcomes or any related financial statement effect thereof.8.SEGMENT INFORMATIONASC 280,Segment Repor?ng,establishes standards for repor?ng informa?on about opera?ng

165、 segments.Opera?ng segments are defined as components of an enterprise about which separate financial informa?on is available that is evaluated regularly by the chief opera?ng decision maker,or decision-making group,in deciding how to allocate resources and in assessing performance.Our chief opera?n

166、g decision makers(CODMs)are our Chief Execu?ve Officer and Chief Technology Officer.We are organized by line of business and geographically.While our CODMs evaluate results in a number of different ways,the line of business management structure is the primary basis for which the alloca?on of resourc

167、es and financial results are assessed.The tabular informa?on below presents financial informa?on that is provided to our CODMs for their review and assists our CODMs with evalua?ng the companys performance and alloca?ng company resources.We have three businessescloud and license,hardware and service

168、seach of which is comprised of a single opera?ng segment.All three of our businesses market and sell our offerings globally to businesses of many sizes,government agencies,educa?onal ins?tu?ons and resellers with a worldwide sales force posi?oned to offer the combina?ons that best meet customer need

169、s.Our cloud and license business engages in the sale,marke?ng and delivery of our enterprise applica?ons and infrastructure technologies through cloud and on-premise deployment models including our cloud services and license support offerings;and our cloud license and on-premise license offerings.Cl

170、oud services and license support revenues are generated from offerings that are typically contracted with customers directly,billed to customers in advance,delivered to customers over?me with our revenue recogni?on occurring over the contractual terms and renewed by customers upon comple?on of the c

171、ontractual terms.Cloud services and license support contracts provide customers with access to the latest updates to the applica?ons and infrastructure technologies as they become available and for which the customer contracted and also include related technical support services over the contractual

172、 term.Cloud license and on-premise license revenues represent fees earned from gran?ng customers licenses,generally on a perpetual basis,to use our database and middleware and our applica?ons so?ware products within cloud and on-premise informa?on technology(IT)environments.We generally recognize re

173、venues at the point in?me the so?ware is made available to the customer to download and use,which typically is immediate upon signature of the license contract.In each fiscal year,our cloud and license business contractual ac?vi?es are typically highest in our fourth fiscal quarter and the related c

174、ash flows are typically highest in the following quarter(i.e.,in the first fiscal quarter of the next fiscal year)as we receive payments from these contracts.Our hardware business provides infrastructure technologies including Oracle Engineered Systems,servers,storage,industry-specific hardware,oper

175、a?ng systems,virtualiza?on,management and other hardware-related so?ware to support diverse IT environments.Our hardware business also offers hardware support,which provides customers ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unaudited)18Table o

176、f Contentswith so?ware updates for the so?ware components that are essen?al to the func?onality of their hardware products and can also include product repairs,maintenance services and technical support services that are typically delivered and recognized ratably over the contractual term.Our servic

177、es business provides services to customers and partners to help maximize the performance of their investments in Oracle applica?ons and infrastructure technologies.We do not track our assets for each business.Consequently,it is not prac?cal to show assets by opera?ng segment.The following table pres

178、ents summary results for each of our three businesses:Three Months Ended Nine Months Ended(in millions)February 28,2025 February 29,2024 February 28,2025 February 29,2024 Cloud and license:Revenues$12,136$11,219$35,525$32,392 Cloud services and license support expenses 2,690 2,288 7,667 6,433 Sales

179、and marke?ng expenses 1,817 1,758 5,477 5,339 Margin$7,629$7,173$22,381$20,620 Hardware:Revenues$703$754$2,086$2,224 Hardware products and support expenses 187 208 499 623 Sales and marke?ng expenses 66 72 201 220 Margin$450$474$1,386$1,381 Services:Revenues$1,291$1,307$3,885$4,058 Services expenses

180、 1,029 1,120 3,174 3,431 Margin$262$187$711$627 Totals:Revenues$14,130$13,280$41,496$38,674 Expenses 5,789 5,446 17,018 16,046 Margin$8,341$7,834$24,478$22,628 The margins reported reflect only the direct controllable costs of each line of business and do not include alloca?ons of research and devel

181、opment,general and administra?ve and certain other allocable expenses,net.Addi?onally,the margins reported above do not reflect amor?za?on of intangible assets,acquisi?on related and other expenses,restructuring expenses,stock-based compensa?on,interest expense or certain other non-opera?ng(expenses

182、)income,net.Refer to the table below for a reconcilia?on of our total margin for opera?ng segments to our income before income taxes as reported per our condensed consolidated statements of opera?ons.(1)(1)(1)(1)(1)ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)Febru

183、ary 28,2025(Unaudited)19Table of ContentsThe following table reconciles total margin for opera?ng segments to income before income taxes:Three Months Ended Nine Months Ended(in millions)February 28,2025 February 29,2024 February 28,2025 February 29,2024 Total margin for opera?ng segments$8,341$7,834

184、$24,478$22,628 Research and development (2,429)(2,248)(7,206)(6,689)General and administra?ve (390)(377)(1,135)(1,146)Amor?za?on of intangible assets (548)(749)(1,763)(2,267)Acquisi?on related and other (28)(155)(72)(214)Restructuring (63)(90)(220)(311)Stock-based compensa?on for opera?ng segments (

185、422)(368)(1,186)(1,014)Expense alloca?ons and other,net (103)(97)(327)(320)Interest expense (892)(876)(2,600)(2,636)Non-opera?ng(expenses)income,net (18)(9)39 (72)Income before income taxes$3,448$2,865$10,008$7,959 Disaggrega?on of RevenuesWe have considered informa?on that is regularly reviewed by

186、our CODMs in evalua?ng financial performance and disclosures presented outside of our financial statements in our earnings releases and used in investor presenta?ons to disaggregate revenues to depict how the nature,amount,?ming and uncertainty of revenues and cash flows are affected by economic fac

187、tors.The principal category we use to disaggregate revenues is the nature of our products and services as presented in our condensed consolidated statements of opera?ons.The following table is a summary of our total revenues by geographic region:Three Months Ended Nine Months Ended(in millions)Febru

188、ary 28,2025 February 29,2024 February 28,2025 February 29,2024 Americas$9,000$8,270$26,305$24,177 EMEA 3,421 3,316 10,029 9,491 Asia Pacific 1,709 1,694 5,162 5,006 Total revenues$14,130$13,280$41,496$38,674 Comprised of Europe,the Middle East and AfricaThe following table presents our cloud service

189、s and license support revenues by offerings:Three Months Ended Nine Months Ended(in millions)February 28,2025 February 29,2024 February 28,2025 February 29,2024 Cloud services$6,210$5,054$17,769$14,464 License support 4,797 4,909 14,562 14,685 Total cloud services and license support revenues$11,007

190、$9,963$32,331$29,149 (1)(1)ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unaudited)20Table of ContentsThe following table presents our cloud services and license support revenues by applica?ons and infrastructure ecosystems:Three Months Ended Nine M

191、onths Ended(in millions)February 28,2025 February 29,2024 February 28,2025 February 29,2024 Applica?ons cloud services and license support$4,811$4,584$14,363$13,529 Infrastructure cloud services and license support 6,196 5,379 17,968 15,620 Total cloud services and license support revenues$11,007$9,

192、963$32,331$29,149 9.EARNINGS PER SHAREBasic earnings per share is computed by dividing net income for the period by the weighted-average number of common shares outstanding during the period.Diluted earnings per share is computed by dividing net income for the period by the weighted-average number o

193、f common shares outstanding during the period,plus the dilu?ve effect of outstanding restricted stock-based awards,stock op?ons and shares issuable under the employee stock purchase plan as applicable pursuant to the treasury stock method.The following table sets forth the computa?on of basic and di

194、luted earnings per share:Three Months Ended Nine Months Ended(in millions,except per share data)February 28,2025 February 29,2024 February 28,2025 February 29,2024 Net income$2,936$2,401$9,016$7,323 Weighted-average common shares outstanding 2,799 2,748 2,783 2,741 Dilu?ve effect of employee stock p

195、lans 75 71 82 79 Dilu?ve weighted-average common shares outstanding 2,874 2,819 2,865 2,820 Basic earnings per share$1.05$0.87$3.24$2.67 Diluted earnings per share$1.02$0.85$3.15$2.60 An?-dilu?ve stock awards excluded from calcula?on 22 27 23 27 These stock awards primarily relate to con?ngently iss

196、uable shares pursuant to performance stock op?on arrangements.Such shares could be dilu?ve in the future.10.LEGAL PROCEEDINGSDeriva?ve Li?ga?on Concerning Oracles NetSuite Acquisi?onOn May 3 and July 18,2017,two alleged stockholders filed separate deriva?ve lawsuits in the Court of Chancery of the S

197、tate of Delaware,purportedly on Oracles behalf.Therea?er,the court consolidated the two deriva?ve cases and designated the July 18,2017 complaint as the opera?ve complaint.The consolidated lawsuit was brought against all the then-current members and one former member of our Board of Directors,and Or

198、acle as a nominal defendant.Plain?ffs alleged that the defendants breached their fiduciary du?es by causing Oracle to agree to purchase NetSuite Inc.at an excessive price.The complaint,which was amended several?mes,sought declaratory relief,unspecified monetary damages(including interest)and a?orney

199、s fees and costs.A?er various proceedings,the case proceeded to trial on July 18,2022,and on May 12,2023,the court issued its trial ruling,rejec?ng plain?ffs claims and finding for the two remaining defendants:our Chief Execu?ve Officer and our Chief Technology Officer.Plain?ffs appealed,and on Janu

200、ary 21,2025,the Supreme Court of Delaware,si?ng en banc,affirmed the trial courts opinion in favor of defendants.This ma?er is now concluded.(1)(1)ORACLE CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Con?nued)February 28,2025(Unaudited)21Table of ContentsNetherlands Privacy Class A

201、c?onOn August 14,2020,The Privacy Collec?ve(TPC),a founda?on having its registered office in Amsterdam,filed a purported class ac?on lawsuit against Oracle Nederland B.V,Oracle Corpora?on and Oracle America,Inc.(the Oracle Defendants),S,Inc.and SFDC Netherlands B.V.in the District Court of Amsterdam

202、.TPC alleges that the Oracle Defendants Data Management Pla?orm product violates certain ar?cles of the EU Charter of Fundamental Rights,the General Data Protec?on Regula?on(GDPR)and the Dutch Telecommunica?ons Act(Telecommunica?ewet).TPC claims damages under a number of categories,including:“immate

203、rial damages”(at a fixed amount of 500 per Dutch internet user);“material damages”(in that the costs of loss of control over personal data should be equated to the market value of the personal data for par?es like the Oracle Defendants);compensa?on for losses suffered due to an alleged data breach(a

204、t a fixed amount of 100 per Dutch internet user);and compensa?on for the costs of the li?ga?on funder(10%to 25%of the compensa?on awarded);and the(actual)cost of the proceedings and extrajudicial costs.We filed our defense on March 3,2021,and on December 29,2021,the District Court issued a judgment,

205、holding that all of TPCs claims were deemed inadmissible because of fundamental procedural flaws.TPC filed an appeal with the Court of Appeal in Amsterdam challenging the District Courts judgment,except for the claims regarding the alleged data breach,which were dropped.On June 18,2024,the Court of

206、Appeal overturned the District Courts decision regarding admissibility,thus permi?ng the case to proceed.We requested that the Court of Appeal permit an interim appeal to the Dutch Supreme Court and/or the European Court of Jus?ce.On September 24,2024,the Court of Appeal issued a judgment confirming

207、 that TPCs claims are admissible and referred the ma?er back to the District Court of Amsterdam for a decision on the merits of TPCs claims,including TPCs claims for damages under ar?cle 82 of the GDPR.The Court of Appeal also granted Oracles request for an interim appeal to the Supreme Court,appeal

208、ing the June 18 and the September 24,2024,judgments.Oracle filed its statement of appeal with the Dutch Supreme Court on December 20,2024,and TPC appeared in the proceedings on January 31,2025.The filing of the Supreme Court appeal effec?vely suspended proceedings before the District Court pursuant

209、to applicable procedural rules.TPC filed its statement of defense in response to our Supreme Court appeal and a counter appeal on February 27,2025.The appeal has been stayed un?l March 28,2025 to allow Oracle to submit a statement of defense to the counter appeal.We believe that we have meritorious

210、defenses against this ac?on,including defenses to the quantum of damages claimed,and we will con?nue to vigorously defend it.While the final outcome of this ma?er cannot be predicted with certainty and we cannot es?mate a range of loss at this?me,we do not believe that it will have a material impact

211、 on our financial posi?on or results of opera?ons.Other Li?ga?onWe are party to various other legal proceedings and claims,either asserted or unasserted,which arise in the ordinary course of business,including proceedings and claims that relate to acquisi?ons we have completed or to companies we hav

212、e acquired or are a?emp?ng to acquire.While the outcome of these ma?ers cannot be predicted with certainty,we do not believe that the outcome of any of these ma?ers,individually or in the aggregate,will result in losses that are materially in excess of amounts already recognized,if any.22Table of Co

213、ntentsItem 2.Managements Discussion and Analysis of Financial Condi?on and Results of Opera?onsWe begin Managements Discussion and Analysis of Financial Condi?on and Results of Opera?ons with an overview of our businesses and significant trends.This overview is followed by a summary of our cri?cal a

214、ccoun?ng es?mates that we believe are important to understanding significant assump?ons and judgments incorporated in our reported financial results.We then provide a more detailed analysis of our results of opera?ons and financial condi?on.Business OverviewOracle provides products and services that

215、 address enterprise informa?on technology(IT)needs.Our products and services include enterprise applica?ons and infrastructure offerings that are delivered worldwide through a variety of flexible and interoperable IT deployment models.These models include on-premise,cloud-based and hybrid deployment

216、s(an approach that combines both on-premise and cloud-based deployments).Accordingly,we offer choice and flexibility to our customers and facilitate the product,service and deployment combina?ons that best suit our customers needs.Through our worldwide sales force and Oracle Partner Network,we sell

217、to customers all over the world including businesses of many sizes,government agencies,educa?onal ins?tu?ons and resellers.We have three businesses:cloud and license;hardware;and services;each of which comprises a single opera?ng segment.The descrip?ons set forth below as a part of this Item 2 Manag

218、ements Discussion and Analysis of Financial Condi?on and Results of Opera?ons and the informa?on contained within Note 8 of Notes to Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report provide addi?onal informa?on related to our businesses and opera?ng segments an

219、d align to how our chief opera?ng decision makers(CODMs),which are our Chief Execu?ve Officer and Chief Technology Officer,view our opera?ng results and allocate resources.Cloud and License Business Our cloud and license business,which represented 85%of our total revenues on a trailing 4-quarter bas

220、is,markets,sells and delivers a broad spectrum of enterprise applica?ons and infrastructure technologies through our cloud and license offerings.Revenue streams included in our cloud and license business are:Cloud services and license support revenues,which include:ocloud services revenues,which are

221、 earned by providing customers access to Oracle Cloud applica?ons and infrastructure technologies via cloud-based deployment models that Oracle develops,provides unspecified updates and enhancements for,deploys,hosts,manages and supports and that customers access by entering into a subscrip?on agree

222、ment with us for a stated period.Oracle Cloud Applica?ons and Oracle Cloud Infrastructure(collec?vely Oracle Cloud Services)arrangements generally:are billed in advance of the cloud services being delivered;have dura?ons of one to four years;are renewed at the customers op?on;and are recognized as r

223、evenues ratably over the contractual period of the cloud contract or,in the case of usage model contracts,as the cloud services are consumed over?me;andolicense support revenues,which are earned by providing Oracle license support services to customers that have elected to purchase support services

224、in connec?on with the purchase of Oracle applica?ons and infrastructure so?ware licenses for use in cloud,on-premise and other IT environments.Substan?ally all license support customers renew their support contracts with us upon expira?on in order to con?nue to benefit from technical support service

225、s and the periodic issuance of unspecified updates and enhancements,which current license support customers are en?tled to receive.License support contracts are generally:priced as a percentage of the net fees paid by the customer to purchase a cloud license and/or on-premise license;billed in advan

226、ce of the support services being performed;renewed at the customers op?on;and recognized as revenues ratably over the contractual period that the support services are provided,which is generally one year.Cloud license and on-premise license revenues,which include revenues from the licensing of our s

227、o?ware products including Oracle Applica?ons,Oracle Database,Oracle Middleware and Java,among others,which our customers deploy within cloud-based,on-premise or other IT environments.Our cloud license and on-premise license transac?ons are generally perpetual in nature and are generally recognized a

228、s revenues up front at the point in?me when the so?ware is made available to the customer to download and use.Revenues from usage-based royalty arrangements for dis?nct cloud licenses and on-premise licenses are 23Table of Contentsrecognized at the point in?me when the so?ware end user usage occurs.

229、The?ming of a few large license transac?ons can substan?ally affect our quarterly license revenues due to the point-in-?me nature of revenue recogni?on for license transac?ons,which is different than the typical revenue recogni?on pa?ern for our cloud services and license support revenues in which r

230、evenues are recognized over?me.Cloud license and on-premise license customers have the op?on to purchase and renew license support contracts,as further described above.Providing choice and flexibility to our customers as to when and how they deploy Oracle applica?ons and infrastructure technologies

231、are important elements of our corporate strategy.In recent periods,customer demand for our applica?ons and infrastructure technologies delivered through our Oracle Cloud Services has increased.To address customer demand and enable customer choice,we have certain programs for customers to pivot their

232、 applica?ons and infrastructure so?ware licenses and the related license support to the Oracle Cloud for new deployments and to migrate to and expand with the Oracle Cloud for their exis?ng workloads.The propor?on of our cloud services revenues rela?ve to our total revenues has increased and we expe

233、ct this trend to con?nue.Cloud services revenues represented 44%and 43%of our total revenues for the three-and nine-month periods ended February 28,2025,respec?vely,and 38%and 37%of our total revenues for the three-and nine-month periods ended February 29,2024,respec?vely.Our cloud and license busin

234、ess revenue growth is affected by many factors,including the strength of general economic and business condi?ons;governmental budgetary constraints;the strategy for and compe?ve posi?on of our offerings;customer sa?sfac?on with our offerings;the con?nued renewal of our cloud services and license sup

235、port customer contracts by the customer contract base;substan?ally all customers con?nuing to purchase license support contracts in connec?on with their license purchases;the pricing of license support contracts sold in connec?on with the sales of licenses;the pricing,amounts and volumes of licenses

236、 and cloud services sold;our ability to manage Oracle Cloud capacity requirements to meet exis?ng and prospec?ve customer demand;and foreign currency rate fluctua?ons.On a constant currency basis,we expect that our total cloud and license revenues generally will con?nue to increase due to:expected g

237、rowth in our cloud services offerings;andcon?nued demand for our cloud license and on-premise license and license support offerings.We believe these factors should contribute to future growth in our cloud and license business total revenues,which should enable us to con?nue to make investments in re

238、search and development and our cloud opera?ons to develop,improve,increase the capacity of and expand the geographic footprint of our cloud and license products and services.Our cloud and license business margin has historically trended upward over the course of the four quarters within a par?cular

239、fiscal year due to the historical upward trend of our cloud and license business revenues over those quarterly periods and because the majority of our costs for this business are generally fixed in the short term.The historical upward trend of our cloud and license business revenues over the course

240、of the four quarters within a par?cular fiscal year is primarily due to the addi?on of new cloud services and license support contracts to the customer contract base,which we generally recognize as revenues ratably or based upon customer usage over the respec?ve contractual terms and the renewal of

241、exis?ng customers cloud services and license support contracts over the course of each fiscal year,which we generally recognize as revenues in a similar manner;and the historical upward trend of our cloud license and on-premise license revenues,which we generally recognize at a point in?me upon deli

242、very;in each case over those four fiscal quarterly periods.Hardware Business Our hardware business,which represented 5%of our total revenues on a trailing 4-quarter basis,provides a broad selec?on of enterprise hardware products and hardware-related so?ware products including Oracle Engineered Syste

243、ms,servers,storage,industry-specific hardware offerings,opera?ng systems,virtualiza?on,management and other hardware-related so?ware and related hardware support.Each hardware product and its related so?ware,such as an opera?ng system or firmware,are highly interdependent and interrelated and are ac

244、counted for as a combined performance obliga?on.The revenues for this combined performance obliga?on are generally recognized 24Table of Contentsat the point in?me that the hardware product and its related so?ware are delivered to the customer and ownership is transferred to the customer.We expect t

245、o con?nue to make investments in research and development to improve exis?ng hardware products and services and to develop new hardware products and services.The majority of our hardware products are sold through indirect channels,including independent distributors and value-added resellers.Our hard

246、ware support offerings provide customers with unspecified so?ware updates for so?ware components that are essen?al to the func?onality of our hardware products and associated so?ware products.Our hardware support offerings can also include product repairs,maintenance services and technical support s

247、ervices.Hardware support contracts are entered into and renewed at the op?on of the customer,are generally priced as a percentage of the net hardware products fees and are generally recognized as revenues ratably as the hardware support services are delivered over the contractual terms.We generally

248、expect our hardware business to have lower opera?ng margins as a percentage of revenues than our cloud and license business due to the incremental costs we incur to produce and distribute these products and to provide support services,including direct materials and labor costs.Our quarterly hardware

249、 revenues are difficult to predict.Our hardware revenues,cost of hardware and hardware opera?ng margins that we report are affected by many factors,including our manufacturing partners abili?es to?mely manufacture or deliver a few large hardware transac?ons;our strategy for and the posi?on of our ha

250、rdware products rela?ve to compe?tor offerings;customer demand for compe?ng offerings,including cloud infrastructure offerings;the strength of general economic and business condi?ons;governmental budgetary constraints;whether customers decide to purchase hardware support contracts at or in close pro

251、ximity to the?me of hardware product sale;the percentage of our hardware support contract customer base that renews its support contracts;the close associa?on between hardware products,which have a finite life,and customer demand for related hardware support as hardware products age;customer decisio

252、ns to either maintain or upgrade their exis?ng hardware infrastructure to newly developed technologies that are available;and foreign currency rate fluctua?ons.Services Business Our services business,which represented 10%of our total revenues on a trailing 4-quarter basis,helps customers and partner

253、s maximize the performance of their investments in Oracle applica?ons and infrastructure technologies.We believe that our services are differen?ated based on our focus on Oracle technologies,extensive experience,broad sets of intellectual property and best prac?ces.Our services offerings include con

254、sul?ng services and advanced customer services.Our services business has lower margins than our cloud and license and hardware businesses.Our services revenues are affected by many factors including our strategy for,and the compe?ve posi?on of,our services;customer demand for our cloud and license a

255、nd hardware offerings and the related services that we may market and sell in connec?on with these offerings;general economic condi?ons;governmental budgetary constraints;personnel reduc?ons in our customers IT departments;?ghter controls over customer discre?onary spending;and foreign currency rate

256、 fluctua?ons.Acquisi?onsOur selec?ve and ac?ve acquisi?on program is another important element of our corporate strategy.Historically,we have invested billions of dollars to acquire a number of complementary companies,products,services and technologies.As compelling opportuni?es become available,we

257、may acquire companies,products,services and technologies in furtherance of our corporate strategy.We believe that we can fund our future acquisi?ons with our internally available cash,cash equivalents and marketable securi?es balances,cash generated from opera?ons,addi?onal borrowings or from the is

258、suance of addi?onal securi?es.We es?mate the financial impact of any poten?al acquisi?on with regard to earnings,opera?ng margin,cash flows and return on invested capital targets,among others,before deciding to move forward with an acquisi?on.25Table of ContentsInvestment in Ampere Compu?ng Holdings

259、 LLCFrom?me to?me since 2017,we have made investments in Ampere Compu?ng Holdings LLC(Ampere),a related party en?ty,in the form of equity and conver?ble debt instruments.The total carrying value of our investments in Ampere,a?er accoun?ng for losses under the equity method of accoun?ng,was$1.5 billi

260、on as of February 28,2025.We currently expect Ampere to con?nue to generate net losses in future periods,but we remain confident in the long-term poten?al of Amperes server chips.Our equity investments in Ampere represent an ownership interest of approximately 29%as of February 28,2025.We also own c

261、onver?ble debt investments in Ampere which,under the terms of an agreement with Ampere and other co-investors,will mature in June 2026 and are conver?ble into equity securi?es at the holders op?on under certain circumstances.During the nine months ended February 28,2025,we invested an aggregate of$2

262、25 million in conver?ble debt instruments issued by Ampere.In accordance with the terms of an agreement with other co-investors,we are also a counterparty to certain put(exercisable by a co-investor)and call(exercisable by Oracle)op?ons at prices of approximately$450 million to$1.5 billion,respec?ve

263、ly,to acquire addi?onal equity interests in Ampere from our co-investors through January 2027.If either of such op?ons is exercised by us or our co-investors,we would obtain control of Ampere and consolidate its results with our results of opera?ons.Cri?cal Accoun?ng Es?mates Our consolidated financ

264、ial statements are prepared in accordance with United States(U.S.)generally accepted accoun?ng principles(GAAP),which requires us to make certain es?mates,judgments and assump?ons that can affect the reported amounts of assets,liabili?es,revenues,expenses,and related disclosures.Cri?cal accoun?ng es

265、?mates are those es?mates that involve a significant level of es?ma?on uncertainty and have had,or are reasonably likely to have,a material impact on our financial condi?on or results of opera?ons.We believe that the es?mates,judgments and assump?ons upon which we rely are reasonable based upon info

266、rma?on available to us at the?me that these es?mates,judgments and assump?ons are made.To the extent that there are differences between these es?mates,judgments or assump?ons and actual results,our financial statements will be affected.We have cri?cal accoun?ng es?mates in the areas of business comb

267、ina?ons,income taxes and non-marketable investments.During the first quarter of fiscal 2025,we completed an assessment of the useful lives of our servers and increased the es?mated useful lives from five years to six years,effec?ve at the beginning of fiscal 2025.Refer to Note 1 of Notes to Condense

268、d Consolidated Financial Statements included elsewhere in this Quarterly Report for more informa?on.There were no other significant changes to our cri?cal accoun?ng es?mates.Refer to“Cri?cal Accoun?ng Es?mates”under Managements Discussion and Analysis of Financial Condi?on and Results of Opera?ons c

269、ontained in Part II,Item 7 of our Annual Report on Form 10-K for the fiscal year ended May 31,2024 for a more complete discussion of our cri?cal accoun?ng es?mates.Results of Opera?onsPresenta?on of Opera?ng Segment Results and Other Financial Informa?on In our results of opera?ons discussion below,

270、we provide an overview of our total consolidated revenues,total consolidated opera?ng expenses and total consolidated opera?ng margin,all of which are presented on a GAAP basis.We also present a GAAP-based discussion below for substan?ally all of the other expense items as presented in our condensed

271、 consolidated statements of opera?ons that are not directly a?ributable to our three businesses.In addi?on,we discuss below the results of each of our three businessescloud and license,hardware and serviceswhich are our opera?ng segments as defined pursuant to ASC 280,Segment Repor?ng.The financial

272、repor?ng for our three businesses that is presented below is presented in a manner that is consistent with that used by our CODMs.Our opera?ng segment presenta?on below reflects revenues,direct costs and sales and marke?ng expenses that correspond to and are directly a?ributable to each of our three

273、 businesses.We also u?lize these inputs to calculate and present a segment margin for each of our three businesses in the discussion below.Consistent with our internal management repor?ng processes,research and development expenses,general and administra?ve expenses,stock-based compensa?on expenses,

274、amor?za?on of intangible assets,certain other expense alloca?ons,acquisi?on related and other expenses,restructuring expenses,interest expense,26Table of Contentsnon-opera?ng(expenses)income,net and provision for income taxes are not a?ributed to our three opera?ng segments because our management do

275、es not view the performance of our three businesses including such items and/or it is imprac?cable to do so.Refer to“Supplemental Disclosure Related to Certain Charges”below for addi?onal discussion of certain of these items and Note 8 of Notes to Condensed Consolidated Financial Statements included

276、 elsewhere in this Quarterly Report for a reconcilia?on of the summa?ons of total segment margin as presented in the discussion below to total income before income taxes as presented per our condensed consolidated statements of opera?ons for all periods presented.Constant Currency Presenta?onOur int

277、erna?onal opera?ons have provided,and are expected to con?nue to provide,a significant por?on of each of our businesses revenues and expenses.As a result,each of our businesses revenues and expenses and our total revenues and expenses will con?nue to be affected by changes in the U.S.Dollar against

278、major interna?onal currencies.In order to provide a framework for assessing how our underlying businesses performed,excluding the effects of foreign currency rate fluctua?ons,we compare the percent change in the results from one period to another period in this Quarterly Report using constant curren

279、cy.To present this informa?on,current and compara?ve prior period results for en?es repor?ng in currencies other than U.S.Dollars are converted into U.S.Dollars at constant exchange rates(i.e.,the rates in effect on May 31,2024,which was the last day of our prior fiscal year)rather than the actual e

280、xchange rates in effect during the respec?ve periods.For example,if an en?ty repor?ng in Euros had revenues of 1.0 million Euros from products sold on February 28,2025 and February 29,2024,our financial statements would reflect reported revenues of$1.05 million in the first nine months of fiscal 202

281、5(using 1.05 as the applicable average exchange rate for the period)and$1.08 million in the first nine months of fiscal 2024(using 1.08 as the applicable average exchange rate for the period).The constant currency presenta?on,however,would translate the results for each of the first nine months of f

282、iscal 2025 and 2024 using the May 31,2024 exchange rate and indicate,in this example,no change in revenues between the periods compared.In each of the tables below,we present the percent change based on actual,unrounded results in reported currency and in constant currency.Total Revenues and Opera?n

283、g Expenses Three Months Ended Nine Months Ended February 28,Percent Change February 29,February 28,Percent Change February 29,(Dollars in millions)2025 Actual Constant 2024 2025 Actual Constant 2024 Total Revenues by Geography:Americas$9,000 9%10%$8,270$26,305 9%10%$24,177 EMEA 3,421 3%6%3,316 10,02

284、9 6%6%9,491 Asia Pacific 1,709 1%5%1,694 5,162 3%5%5,006 Total revenues 14,130 6%8%13,280 41,496 7%8%38,674 Total Opera?ng Expenses 9,772 3%4%9,530 28,927 3%4%28,007 Total Opera?ng Margin$4,358 16%20%$3,750$12,569 18%19%$10,667 Total Opera?ng Margin%31%28%30%28%Revenues by Geography:Americas 64%62%6

285、3%62%EMEA 24%25%24%25%Asia Pacific 12%13%13%13%Total Revenues by Business:Cloud and license$12,136 8%10%$11,219$35,525 10%11%$32,392 Hardware 703 -7%-5%754 2,086 -6%-5%2,224 Services 1,291 -1%1%1,307 3,885 -4%-3%4,058 Total revenues$14,130 6%8%$13,280$41,496 7%8%$38,674%Revenues by Business:Cloud an

286、d license 86%84%86%83%Hardware 5%6%5%6%Services 9%10%9%11%Comprised of Europe,the Middle East and Africa(1)(1)27Table of ContentsTotal revenues increased by$850 million and$2.8 billion in reported currency in the third quarter and the first nine months of fiscal 2025,respec?vely,rela?ve to the corre

287、sponding prior year periods,due to a$917 million and a$3.1 billion increase in cloud and license revenues,par?ally offset by a$51 million and a$138 million decrease in hardware revenues and a$16 million and a$173 million decrease in services revenues,in each case during the third quarter and the fir

288、st nine months of fiscal 2025,respec?vely,rela?ve to the corresponding prior year periods.Excluding the unfavorable effects of foreign currency rate fluctua?ons of 2%in the third quarter of fiscal 2025 and 1%in the first nine months of fiscal 2025,the increase in our cloud and license business reven

289、ues was primarily due to growth in our cloud services revenues as customers purchased our applica?ons and infrastructure technologies and also renewed their related cloud contracts to con?nue to gain access to the latest versions of our technologies.In constant currency,applica?ons cloud services an

290、d license support contributed 23%and 26%and infrastructure cloud services and license support contributed 77%and 74%of the growth in cloud services and license support revenues,in each case in the third quarter and the first nine months of fiscal 2025,respec?vely.In our hardware business,the constan

291、t currency decrease in revenues in the fiscal 2025 periods presented was due to the emphasis we placed on the marke?ng and sale of our growing cloud-based infrastructure technologies.In our services business,the constant currency increase in revenues in the third quarter of fiscal 2025 was a?ributab

292、le to an increase in our consul?ng services revenues,par?ally offset by a decrease in our advanced customer services revenues,while the constant currency decrease in services business revenues in the first nine months of fiscal 2025 was a?ributable to a decrease in revenues from each of our primary

293、services offerings.The Americas region contributed 75%and 74%and the Asia Pacific region contributed 7%and 8%to the constant currency total revenue growth during the third quarter and the first nine months of fiscal 2025,respec?vely,and the EMEA region contributed 18%to the constant currency total r

294、evenue growth during each of the fiscal 2025 periods presented.Total GAAP opera?ng expenses increased by$242 million and$920 million in reported currency in the third quarter and the first nine months of fiscal 2025,respec?vely,rela?ve to the corresponding prior year periods.The increase in GAAP ope

295、ra?ng expenses in reported currency was primarily due to a$430 million and a$1.3 billion increase in cloud services and license support expenses primarily due to higher infrastructure expenses and higher employee related expenses,including higher expenses rela?ng to stock-based compensa?on,that were

296、 incurred to support the growth in our cloud services revenues;a$181 million and a$517 million increase in research and development expenses primarily due to higher employee related expenses,including higher stock-based compensa?on expenses;and a$77 million and a$184 million increase in sales and ma

297、rke?ng expenses,in each case during the third quarter and the first nine months of fiscal 2025,respec?vely,rela?ve to the corresponding prior year periods.These increases in GAAP opera?ng expenses in reported currency were par?ally offset by a$201 million and a$504 million decrease in expenses for t

298、he amor?za?on of intangible assets as certain of our assets were fully amor?zed;a$127 million and a$142 million decrease in acquisi?on related and other expenses primarily due to lower impairment charges on certain assets;an$84 million and a$235 million decrease in services expenses primarily due to

299、 decreases in external contractor and employee related expenses;a$20 million and a$119 million decrease in hardware expenses due to lower hardware product and support costs;and a$27 million and a$91 million decrease in restructuring expenses,in each case during the third quarter and the first nine m

300、onths of fiscal 2025,respec?vely,rela?ve to the corresponding prior year periods.In constant currency,our total opera?ng margin and total opera?ng margin as a percentage of revenues increased in the fiscal 2025 periods presented,rela?ve to the corresponding prior year periods,due to higher revenues.

301、Supplemental Disclosure Related to Certain ChargesTo supplement our condensed consolidated financial informa?on,we believe that the following informa?on is helpful to an overall understanding of our past financial performance and prospects for the future.28Table of ContentsOur opera?ng results repor

302、ted pursuant to GAAP included the following business combina?on accoun?ng adjustments and expenses related to acquisi?ons and certain other expenses,including stock-based compensa?on,that affected our GAAP net income:Three Months Ended Nine Months Ended(in millions)February 28,2025 February 29,2024

303、February 28,2025 February 29,2024 Amor?za?on of intangible assets$548$749$1,763$2,267 Acquisi?on related and other 28 155 72 214 Restructuring 63 90 220 311 Stock-based compensa?on,opera?ng segments 422 368 1,186 1,014 Stock-based compensa?on,R&D and G&A 776 680 2,188 1,913 Income tax effects (542)(

304、461)(2,042)(1,939)$1,295$1,581$3,387$3,780 Represents the amor?za?on of intangible assets,all of which were acquired in connec?on with our acquisi?ons.As of February 28,2025,es?mated future amor?za?on related to intangible assets was as follows(in millions):Remainder of fiscal 2025$544 Fiscal 2026 1

305、,639 Fiscal 2027 672 Fiscal 2028 635 Fiscal 2029 561 Fiscal 2030 522 Therea?er 558 Total intangible assets,net$5,131 Acquisi?on related and other expenses consist of personnel related costs for transi?onal and certain other employees,certain business combina?on adjustments including certain adjustme

306、nts a?er the measurement period has ended and certain other opera?ng items,net.Restructuring expenses in each of the fiscal 2025 and 2024 periods presented primarily related to employee severance in connec?on with the Fiscal 2024 Oracle Restructuring Plan(2024 Restructuring Plan).Addi?onal informa?o

307、n regarding certain of our restructuring plans is provided in managements discussion below under“Restructuring Expenses,”in Note 4 of Notes to Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report and in Note 8 of Notes to Consolidated Financial Statements included

308、in our Annual Report on Form 10-K for the fiscal year ended May 31,2024.Stock-based compensa?on was included in the following opera?ng expense line items of our condensed consolidated statements of opera?ons(in millions):Three Months Ended Nine Months Ended February 28,2025 February 29,2024 February

309、 28,2025 February 29,2024 Cloud services and license support$160$138$459$386 Hardware 8 6 21 17 Services 54 45 150 123 Sales and marke?ng 200 179 556 488 Stock-based compensa?on,opera?ng segments 422 368 1,186 1,014 Research and development 675 584 1,902 1,642 General and administra?ve 101 96 286 27

310、1 Total stock-based compensa?on$1,198$1,048$3,374$2,927 For all periods presented,the applicable jurisdic?onal tax rates applied to our income before income taxes a?er excluding the tax effects of items within the table above such as for stock-based compensa?on,amor?za?on of intangible assets,restru

311、cturing,and certain acquisi?on related and other items,and a?er excluding the net deferred tax effects associated with a previously recorded income tax benefit that resulted from a par?al realignment of our legal en?ty structure.These adjustments resulted in effec?ve tax rates of 19.9%and 19.7%,inst

312、ead of 14.9%and 9.9%,respec?vely,for the third quarter and the first nine months of fiscal 2025 and 18.9%and 18.8%,instead of 16.2%and 8.0%,respec?vely,for the third quarter and the first nine months of fiscal 2024,which in each case represented our effec?ve tax rates as derived per our condensed co

313、nsolidated statements of opera?ons.(1)(2)(3)(4)(4)(5)(1)(2)(3)(4)(5)29Table of ContentsCloud and License BusinessOur cloud and license business engages in the sale and marke?ng of our applica?ons and infrastructure technologies that are delivered through various deployment models and include:Oracle

314、Cloud Services offerings;Oracle cloud license and on-premise license offerings;and Oracle license support offerings.Our cloud services deliver applica?ons and infrastructure technologies on a subscrip?on basis via cloud-based deployment models that we develop,provide unspecified updates and enhancem

315、ents for,deploy,host,manage and support.Revenues for our cloud services are generally recognized ratably over the contractual term,which is generally one to four years,or in the case of usage model contracts,as the cloud services are consumed.Cloud license and on-premise license revenues represent f

316、ees earned from gran?ng customers licenses,generally on a perpetual basis,to use our database and middleware and our applica?ons so?ware products within cloud and on-premise IT environments and are generally recognized up front at the point in?me when the so?ware is made available to the customer to

317、 download and use.License support revenues are typically generated through the sale of applica?ons and infrastructure so?ware license support contracts related to cloud licenses and on-premise licenses;are purchased by our customers at their op?on;and are generally recognized as revenues ratably ove

318、r the contractual term,which is generally one year.We con?nue to place significant emphasis,both domes?cally and interna?onally,on direct sales through our own sales force.We also con?nue to market certain of our offerings through indirect channels.Costs associated with our cloud and license busines

319、s are included in cloud services and license support expenses and sales and marke?ng expenses.These costs are largely personnel and infrastructure related and include the cost of providing our cloud services and license support offerings,salaries and commissions earned by our sales force for the sal

320、e of our cloud and license offerings and marke?ng program costs.Three Months Ended Nine Months Ended February 28,Percent Change February 29,February 28,Percent Change February 29,(Dollars in millions)2025 Actual Constant 2024 2025 Actual Constant 2024 Cloud and License Revenues:Americas$7,862 11%12%

321、$7,102$22,951 12%13%$20,537 EMEA 2,877 5%8%2,738 8,378 7%8%7,815 Asia Pacific 1,397 1%5%1,379 4,196 4%6%4,040 Total revenues 12,136 8%10%11,219 35,525 10%11%32,392 Expenses:Cloud services and license support 2,690 18%19%2,288 7,667 19%20%6,433 Sales and marke?ng 1,817 3%5%1,758 5,477 3%4%5,339 Total

322、 expenses 4,507 11%13%4,046 13,144 12%12%11,772 Total Margin$7,629 6%8%$7,173$22,381 9%9%$20,620 Total Margin%63%64%63%64%Revenues by Geography:Americas 65%63%65%63%EMEA 24%25%23%24%Asia Pacific 11%12%12%13%Revenues by Offerings:Cloud services$6,210 23%25%$5,054$17,769 23%24%$14,464 License support

323、4,797 -2%0%4,909 14,562 -1%0%14,685 Cloud license and on-premise license 1,129 -10%-8%1,256 3,194 -2%0%3,243 Total revenues$12,136 8%10%$11,219$35,525 10%11%$32,392 Cloud Services and License Support Revenues by Ecosystem:Applica?ons cloud services and license support$4,811 5%6%$4,584$14,363 6%7%$13

324、,529 Infrastructure cloud services and license support 6,196 15%18%5,379 17,968 15%16%15,620 Total cloud services and license support revenues$11,007 10%12%$9,963$32,331 11%12%$29,149 Excludes stock-based compensa?on and certain expense alloca?ons.Also excludes amor?za?on of intangible assets and ce

325、rtain other GAAP-based expenses,which were not allocated to our opera?ng segment results for purposes of repor?ng to and review by our CODMs,as further described under“Presenta?on of Opera?ng Segment Results and Other Financial Informa?on”above.(1)(1)(1)(1)30Table of ContentsOur cloud and license bu

326、siness total revenues increased by$917 million and$3.1 billion in reported currency in the third quarter and the first nine months of fiscal 2025,respec?vely,rela?ve to the corresponding prior year periods,primarily due to a$1.2 billion and a$3.3 billion increase in cloud services revenues as custom

327、ers purchased our applica?ons and infrastructure technologies and renewed their related cloud contracts to con?nue to gain access to the latest versions of our technologies for which we delivered such cloud services during the periods presented.The increase in cloud services revenues in the third qu

328、arter and the first nine months of fiscal 2025 was par?ally offset by a$239 million and a$172 million total decrease,respec?vely,in cloud license and on-premise license and license support revenues,rela?ve to the corresponding prior year periods.In constant currency,applica?ons cloud services and li

329、cense support contributed 23%and 26%and infrastructure cloud services and license support contributed 77%and 74%of the growth in cloud services and license support revenues in the third quarter and the first nine months of fiscal 2025,respec?vely.The Americas region contributed 74%and 76%,the EMEA r

330、egion contributed 20%and 17%and the Asia Pacific region contributed 6%and 7%to the constant currency revenue growth for this business during the third quarter and the first nine months of fiscal 2025,respec?vely.Total cloud and license business expenses increased by$461 million and$1.4 billion in re

331、ported currency in the third quarter and the first nine months of fiscal 2025,respec?vely,rela?ve to the corresponding prior year periods.Excluding the favorable effects of currency rate fluctua?ons of 2%in the third quarter of fiscal 2025 and less than 1%in the first nine months of fiscal 2025,the

332、constant currency increase in expenses was primarily due to a$399 million and a$961 million increase in infrastructure expenses,an$81 million and a$265 million increase in employee related expenses for employees engaged in cloud services delivery and a$96 million and a$187 million increase in sales

333、and marke?ng expenses,in each case in the third quarter and the first nine months of fiscal 2025,respec?vely,rela?ve to the corresponding prior year periods,to support the increase in our cloud services revenues.Our cloud services and license support expenses have grown in recent periods,and we expect this trend to con?nue during fiscal 2025 as we increase our exis?ng data center capacity and esta