Cloud Wars Live with Bob Evans

In this special episode of Cloud Wars Live from Oracle AI World in Las Vegas, Bob Evans speaks with Mahesh Thiagarajan, President of Oracle Cloud Infrastructure (OCI), about the extraordinary demand reshaping the cloud and AI landscape. With OCI capacity sold out for 2027 and 2028, Thiagarajan explains how Oracle is accelerating infrastructure deployment, leveraging AI to improve internal operations, and developing innovative power strategies to support growing compute requirements.
Inside Oracle's Cloud Expansion
The Big Themes
Oracle's Cloud Demand Accelerates: Oracle Cloud Infrastructure is experiencing extraordinary demand as enterprises accelerate their adoption of AI and cloud technologies. Thiagarajan reveals that OCI's capacity for 2027 and 2028 is already sold out, illustrating the scale of customer commitments and the challenges associated with bringing new infrastructure online. He attributes Oracle's competitive success to several foundational advantages: its longstanding stewardship of mission-critical enterprise data, strong price-performance economics, infrastructure flexibility, and deeply embedded security capabilities. These differentiators make OCI attractive to organizations seeking reliable environments for their most important applications and AI initiatives.
Internal Innovations Become Enterprise Products: Oracle's approach to product development increasingly draws on technologies created to address its own operational challenges. Thiagarajan describes how internal supply chain optimization work helped inform capabilities incorporated into Oracle Fusion applications. Similarly, developers building new applications exposed the need for better tools to maintain, secure, operate, and publish software at scale. That experience contributed to App Composer. OCI's work protecting its own cloud infrastructure also helped shape its security mesh capabilities.
Responsible Development Strengthens Local Communities: Oracle's AI infrastructure expansion is creating responsibilities that extend beyond technology and into the communities hosting its data centers. Thiagarajan describes responsible development as an essential part of the company's strategy, emphasizing environmental considerations, community engagement, and local workforce opportunities. Oracle is pursuing closed-loop liquid cooling systems and adapting power technologies to address concerns about emissions. The company is also investing in workforce training to help residents participate in the emerging AI infrastructure economy.
Big Quote: "I think the next phase of AI is going to be around faster access to compute and the companies that can actually deliver the most optimized TCO for realizing those enterprise AI outcomes and their best ideas."
More from Mahesh Thiagarajan and Oracle:
Follow Mahesh Thiagarajan on LinkedIn or learn more about Oracle Cloud Infrastructure and Oracle's Fusion Cloud Applications.

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In today’s Cloud Wars Minute, I break down the nearly $2.5 trillion in combined backlog reported by the four hyperscalers and explain why I believe the enormous investment in AI infrastructure represents an unprecedented business opportunity — not a sign that the sky is falling.
Highlights
00:02 — With the recent roundup of Q3 numbers from the hyperscalers, and one just before that from Oracle, the hyperscaler backlog now, if we total that all up, adds up to almost $2.5 trillion. And, in an exclusive interview I had with Chicken Little, Chicken Little has recanted its prediction that the sky is falling.
00:35 — I think that we are on the verge of perhaps the greatest industrial revolution, business revolution, and all that the world has ever seen. But, this hand-wringing and negativism and concern about how this early-stage, very, very expensive buildout is going to cripple these extraordinary companies, I think is kind of nuts. And I have some numbers that I think will at least point the way, if not definitively prove, that that will absolutely be the outcome.
01:32 — Microsoft has already got a backlog or RPO of $667 billion, and their projected CapEx spending for the whole year is $170 billion. For Amazon, $578 billion. That's just AWS's reported backlog. For the whole company at Amazon, they are projecting CapEx of $220 billion. But, Andy Jassy said that that is overwhelmingly for AWS and the data center buildout.
02:09 — Google's got a backlog of $561 billion. Parent company Alphabet is projecting about $200 billion in CapEx this year. Again, the overwhelming majority of that going toward Google Cloud. And then Oracle. They've got an enormous backlog, $664 billion. They're expecting to spend about $90 billion on CapEx this year.
03:22 — Now, I know this [CapEx] is a recurring expense, and probably, these numbers will be going up in 2027, but so will this number [RPO] which is much bigger. So, over time, as the backlog and RPO gets bigger, they'll also start to convert some of this backlog or RPO to revenue, and we'll see the growth play out in a formal way on the revenue numbers.
05:11 — The leaders of all of these companies are very bullish, and I think it's time now for [the] Chicken Little example. He's recanted, or it has recanted — Chicken Little — and I think more of us need to start thinking about the positive outcomes of this rather than all the hand-wringing about whether the sky is falling or not. I don't think it is.

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In today's Cloud Wars and AI Agent Minute, I discuss why Microsoft's latest financing move represents a powerful vote of confidence not just in the company, but in the entire AI industry.
Highlights
00:10 — Microsoft has announced plans to raise $25 billion in debt to keep pace with its ambitious AI infrastructure build-out. The market reaction was incredibly positive, with demand exceptionally strong.
00:25 — Reported orders reached around $115 billion, making the bond offering more than 4.5 times oversubscribed. As I'm recording this, the deals are still in the process of being finalized. However, as of the fourth of November, the bonds are expected to settle.
00:53 — While this funding isn't specifically earmarked for AI infrastructure and is instead for general corporate purposes, the timing certainly ties in with Microsoft's broader AI infrastructure ambitions. This is a massive endorsement of Microsoft, particularly given that level of oversubscription. But it's also a significant endorsement of the AI industry as a whole.
01:19 — Yes, there are doubts, and valid ones, about the long-term sustainability of the AI boom. However, if we look at the hard facts here, investor demand really demonstrates the level of confidence in this market. And there's another simple but important point: to unlock the true value of AI, you need the infrastructure to develop, deploy, and scale it.

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In today's Cloud Wars Minute, I reveal how Google Cloud, Palantir, and Oracle are leading an unprecedented surge in AI and cloud revenue growth.
Highlights
00:02 — With Q3 numbers in from several of the Cloud Wars Top 10 companies, I want to do a latest installment of the Cloud Wars Top 10 Growth Chart to see who the fastest-growing publicly traded AI and cloud vendors are. And for Q3, we've got Google Cloud coming in number one, Palantir at number two, Oracle at number three.
00:41 — These are the highest numbers in the 10 years that I've been doing Cloud Wars, and clearly got to lay that at the feet of the AI Revolution. But, also, many of these companies are saying their classic, you know, cloud migration, cloud expansion, cloud applications, and agents businesses are rolling along quite nicely.
01:41 — Palantir's just been on a tear — 96% growth in Q3, following 93% in Q2, $2.31 billion in revenue. Oracle jumped up into that hyper-hypergrowth category at 62% for its cloud business, $11.6 billion. Now, inside Oracle's cloud business, they've got both their applications business and their infrastructure business.
03:15 — But, as I've chronicled over the last couple of weeks, the Microsoft growth rate has been relatively flat over the last several quarters. The growth rate, I'm saying, not saying its revenue has been flat, but the growth rate has hovered between 26% and 30% for the last six quarters. Sometimes up, sometimes down.
04:11 — We saw SAP come in, 26% growth, $7.5 billion in revenue, very impressive for them, and far higher than any other applications business. ServiceNow, very nice, 21%, almost $4 billion in subscription revenue. Workday, 14%, almost two and a half billion dollars, so they're approaching that $10 billion run rate. Salesforce, 11% growth with $11.3 billion in revenue.
04:42 — And then we've got OpenAI — not publicly traded companies — so I can't go to certified results for that. These are all guesses. Maybe it's 1,000% growth. We won't know until they file a registration statement for their IPO.

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In today's Cloud Wars Minute, I break down Alex Karp's warning that the accelerating pace of AI innovation will create winners, losers, and companies headed toward irrelevance.
Highlights
00:02 — Last week, we heard about Palantir's Q3 results. They were incredibly impressive, and I think what we saw in the letter that Palantir CEO Alex Karp sent out to shareholders was very much, I think, a survival guide for AI strategy, AI business, AI sort of thinking that's needed today.
00:55 — Palantir's astonishing growth rate shows that customers are coming to them eagerly, and once the customers are in, they're increasing their spending at a very rapid rate. So, Palantir and Karp have real-world credibility into seeing what's working for customers, what isn't working, and Karp himself, a very colorful individual, extremely intelligent, well-spoken, and bluntly candid about what he thinks.
01:59 — Within that, the U.S. commercial business, which has been on fire the last two and a half years, grew 148% to almost a billion dollars, and now is bigger than its public sector business, which is where, for much of its 23-year history, Palantir's business was concentrated.
02:26 — They had 64 deals bigger than $10 million, 107 deals bigger than $5 million in Q3. So, against that sort of success, here's a little bit what Karp sees and what he shared in that shareholder letter. I go into a lot of detail about this in an article that'll be up later this morning on CloudWars.com .
03:03 — The big point he made was that the pace of change is absolutely dizzying today now, and it can be either business leaders' best friend or worst enemy because this is not going to let up. And a mindset from traditional technology says, "Well, I got two, three years to think about this, look at some different options, and then decide."
04:32 — Karp said, "You know, very, very quickly, we are getting into a world of haves and have-nots. The haves are going to be very happy with their choices." The have-nots are going to be miserable because, he said, we'll see many of them drop down to what he called this middle layer, crowded with companies that are just incapable of really competing anymore.

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