Larry Ellison says the AI 'SaaS-apocalypse' is real — but it won't hurt Oracle

Oracle $ORCL -2.54%, of all companies, would like a word about the future of software. On its latest earnings call, Larry Ellison grabbed one of tech’s nastier new panic phrases — the SaaS-apocalypse — and used it to try to argue that AI’s shakeout won’t bury Oracle but could instead leave the old enterprise giant standing tall in a stronger position.

“Thank God we have these coding tools now that allow us to build a comprehensive set of software — agent-based software — to automate an ecosystem like health care or financial services,” Ellison said. “That is why we think we are a disruptor. That is why we think the SaaS-apocalypse applies to others, but not to us.”

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That’s a striking line from a company better known for corporate plumbing than Silicon Valley prophecy, and it landed on the same day Oracle reported $17.2 billion in quarterly revenue, cloud revenue up 44% to $8.9 billion, cloud infrastructure revenue up 84% to $4.9 billion, and remaining performance obligations up 325% to $553 billion, with Oracle saying most of that jump came from large-scale AI contracts.

Software investors have spent the past several weeks wondering whether AI agents and AI coding tools are about to make parts of the application layer look a lot less sacred. In early February, software and services stocks had shed about $830 billion in market value over six trading days as investors worried that new AI tools were pushing into legal work, sales, marketing, data analysis, and other lucrative corners of enterprise software.

That’s the panic Ellison walked into — and that he, being Larry Ellison, immediately tried to turn into a competitive advantage.

Oracle CEO Mike Sicilia made the same case in a bit more detail, saying, “I do not agree with that at all” about the idea that AI coding tools will spell the end of SaaS, and arguing that Oracle is using those tools to speed product development and embed AI agents directly into its software suites. “Yes, some smaller or single-focused SaaS players may well be disrupted,” he said. “But Oracle Corporation will not be among them.”

He added that Oracle is “building brand new SaaS products using AI and also embedding AI agents right into our existing applications and suites,” and later: “We think AI is disruptive — we do — but we think we are the disruptor.”

That’s Oracle’s real pitch here. It’s not claiming that AI won’t disrupt software but that AI hurts shallow software before it hurts deeply embedded software. What the company is trying to say is that the damage will be uneven and that it sits in a land where compliance, integration, and switching costs are ugly enough to make “just replace it with an agent” sound like something said by someone who doesn’t have to survive an audit.

Oracle, in Ellison’s and Sicilia’s version of the story, has enough stack, data, and customer entrenchment to use AI to fortify SaaS while also making a fortune on the infrastructure boom around it. Investors liked the pitch; shares rose more than 8% after the results dropped. “That’s what we’re doing at Oracle,” Ellison said on the call. “That’s why we think we’re a disruptor.”

Oracle has some receipts for that argument, at least for now: Cloud applications revenue rose 13% in the quarter, while Fusion Cloud ERP revenue climbed 17% and NetSuite Cloud ERP revenue rose 14%. On the call, Sicilia said Oracle is “building brand new SaaS products using AI” while also embedding agents into existing applications, and he pointed to Oracle’s thousands of live AI agents and new Agent Studio as proof that the company intends to sell the shakeout, not just survive it.

Ellison’s comment was a swipe at the rest of the industry and a bid to recast Oracle as something more flattering than an aging incumbent with a very good quarter.

Oracle is one of the industry’s oldest incumbents, a company associated with databases, ERP, and the sort of enterprise machinery that gets called boring right up until it breaks. It’s not sexy or exciting, but it’s paying — and well. Oracle is trying to move from the category of software giant that gets disrupted into the category selling hard hats that gets to narrate the disruption.

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