Oracle 2015 Annual Report Download - page 42

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Table of Contents
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
We begin Management’s Discussion and Analysis of Financial Condition and Results of Operations with an overview of our businesses, key operating segments
and significant trends. This overview is followed by a summary of our critical accounting policies and estimates that we believe are important to understanding the
assumptions and judgments incorporated in our reported financial results. We then provide a more detailed analysis of our results of operations and financial
condition.
Business Overview
Oracle Corporation provides products and services that address all aspects of corporate information technology (IT) environments—application, platform and
infrastructure. Our Oracle Cloud offerings provide a comprehensive and fully integrated stack of application, platform, compute and storage services in all three
primary layers of the cloud: Software as a Service (SaaS), Platform as a Service (PaaS) and Infrastructure as a Service (IaaS). Our on-premise offerings include
Oracle database and middleware software, application software, hardware (Oracle Engineered Systems, servers, storage, networking and industry-specific
products), and related support and services. We provide our cloud and on-premise offerings to over 400,000 worldwide customers via deployment models that best
suit their needs.
Our comprehensive and fully integrated stack of SaaS, PaaS and IaaS offerings integrate the software, hardware and services on the customers’ behalf in IT
environments that we deploy, support and manage for the customer. Our integrated Oracle Cloud offerings are designed to be rapidly deployable to enable
customers shorter time to innovation; easily maintainable to reduce integration and testing work; connectable among differing deployment models to enable
interchangeability and extendibility between cloud and on-premise IT environments; compatible to easily move workloads between on-premise IT environments
and the Oracle Cloud; cost-effective by requiring lower upfront customer investment; and secure, standards-based and reliable. We are a leader in the core
technologies of cloud IT environments, including database and middleware software as well as enterprise applications, virtualization, clustering, large-scale
systems management and related infrastructure. Our products and services are the building blocks of our Oracle Cloud services, our partners’ cloud services and
our customers’ cloud IT environments.
In addition to providing a broad spectrum of cloud offerings, we develop and sell our products and services to our customers worldwide for use in their global data
centers and on-premise IT environments. An important element of our corporate strategy is to continue our investments in, and innovation with respect to, our
products and services that we offer through our cloud and on-premise software, hardware and services businesses. We have a deep understanding as to how all
components within IT environments—application, platform and infrastructure—interact and function with one another. We focus our development efforts on
improving the performance, security, operation and integration of these differing technologies to make them more cost-effective and easier to deploy, manage and
maintain for our customers and to improve their computing performance relative to our competitors. After the initial purchase of Oracle products and services, our
customers can continue to take advantage of our research and development investments and deep IT expertise by purchasing and renewing Oracle support
offerings, which may include product enhancements that we periodically deliver to our Oracle E-Business Suite, Siebel, PeopleSoft and JD Edwards application
software products, among others, or by renewing their SaaS, PaaS and IaaS contracts with us.
As customers deploy with the Oracle Cloud, many are adopting a hybrid IT model whereby certain of their IT resources are deployed and managed through the
Oracle Cloud, while other of their IT resources are deployed and managed on-premise, and both sets of resources can be managed as one. We focus the engineering
of our products and services to best connect these different deployment models to enable flexibility, ease, agility, compatibility, extensibility and seamlessness.
A selective and active acquisition program is another important element of our corporate strategy. We believe our acquisitions enhance the products and services
that we can offer to customers, expand our customer base, provide greater scale to accelerate innovation, grow our revenues and earnings, and increase stockholder
value. In recent years, we have invested billions of dollars to acquire a number of companies, products, services and
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