Oracle Unveils Co-CEO Model to Steer AI Cloud Push, Shares Gain 6% on Leadership Revamp

TradingKey - On September 22, local time, U.S. tech giant Oracle announced a major personnel change on its official website, appointing 39-year-old Clay Magouyrk and 54-year-old Mike Sicilia as co-CEOs to succeed former CEO Safra Catz, who will transition to Executive Vice Chairman of the company's board.

Catz, one of the most distinguished female executives in the tech industry, has served as Oracle's co-CEO since 2014 and became the sole CEO in 2019. During her tenure, she witnessed and drove Oracle's transformation and development.

“Today, Oracle is recognized as the cloud of choice for both AI training and inferencing. I’m very proud of that,” Catz said in a statement. “Oracle’s technology and business have never been stronger. And our breathtaking growth rate points to an even more prosperous future. At this time of strength is the right moment to pass the CEO role to the next generation of capable executives.” 

The newly appointed executives Clay Magouyrk and Mike Sicilia will jointly shoulder the responsibility for Oracle's future development. Magouyrk focuses on engineering and technology. Since joining Oracle's Cloud Infrastructure (OCI) division in 2020, he has been a key driver of the business's success, with OCI's recent rapid growth largely attributed to his leadership.

“Clay’s years of experience leading Oracle’s large, fast-growing Cloud Infrastructure business has demonstrated his readiness for a CEO role.” Ellison said in a statement, Oracle's founder and Chief Technology Officer.

“This has been the opportunity of my lifetime,” Magouyrk said Monday on the call with analysts. The division has entered a period of “hypergrowth,” he added.

The other co-CEO, Mike Sicilia, joined the company in 2009 when Oracle acquired Primavera Systems, where he previously served as Chief Technology Officer. At Oracle, he has been responsible for developing and selling applications for industries such as banking and manages approximately 38,000 employees, including the healthcare division formed after the acquisition of Cerner.

“They are both proven leaders, and I am looking forward to spending the coming years working side-by-side with them,” Ellison stated.

“We believe that investors are already familiar with both Mr. Magouryk and Mr. Sicilia and that their promotions solidify the importance of the Cloud and Industry businesses as the growth levers for the company,” wrote Kirk Materne, an analyst at Evercore ISI.

Analysts note that this personnel change highlights Oracle's strategic focus on cloud infrastructure business, which involves building data centers to provide underlying services for clients like OpenAI and Meta to support the delivery of their AI products.

Oracle has signed massive contracts with these clients, including a recent approximately $300 billion computing capacity agreement with OpenAI, which has significantly increased the company's backlog and is expected to drive cloud infrastructure revenue growth of 77% this fiscal year, reaching $18 billion.

Larry Ellison stated in a declaration: "A few years ago, Clay and Mike invested Oracle's infrastructure and applications business in artificial intelligence — now it appears that this investment is paying off handsomely."

At Monday's close, Oracle's stock rose 6.3% to $328.15, with a year-to-date gain of 97%. According to TradingKey Stock Score, Oracle currently scores 7.51, ranking 14th among 470 software and IT service stocks, performing exceptionally well.