Oracle wins U.S. Department of Defense software contract worth nearly $7 billion
The U.S. Department of Defense announced Thursday that it will work with The company signed a ten-year contract worth nearly $7 billion. That's a major boon for the software maker, whose shares rose about 3% in after-hours trading. The contract covers use of Oracle software in local data centers by military branches, U.S. intelligence systems and the Coast Guard, according to a statement. The CIA was Oracle's first customer. The contract has a base term of five years and includes perpetual software licenses, subscription software licenses, maintenance services and consulting services. Kirsten Davis, chief information officer of the U.S. Department of Defense, said in the announcement that the Department of Defense can save taxpayers at least $441 million by "fundamentally optimizing the acquisition method of Oracle's local deployment software-related capabilities." Oracle co-founder Larry Ellison has long been a supporter of Trump and reportedly donated $45 million to a nonprofit supporting Trump's 2024 presidential campaign. Ellison was one of Trump's first guests to the White House during his second term, when Trump announced plans to build a "Stargate" artificial intelligence data center in the United States. In May this year, the U.S. Department of Defense also announced an agreement with Oracle and other technology companies to deploy artificial intelligence technology in its confidential networks. Still, Oracle's shares are down 38% this year as investors worry that artificial intelligence could hurt the software giant's growth prospects. The company has also continued to borrow money to build artificial intelligence data centers.