Oracle wins US government HR contract, adding to $30B federal cloud push

Oracle secured a government-wide contract to supply cloud-based HR software to US federal agencies, its second major federal win in as many months.

Oracle will provide a cloud-based human resources platform to replace the individual systems used by agencies across the US government, Office of Personnel Management Director Scott Kupor said in a statement Tuesday. The contract expands Oracle's federal footprint just weeks after the company announced a $30 billion cloud infrastructure agreement with the US government for national security and defense workloads.

The HR platform win comes as Oracle prepares to report its fiscal fourth-quarter 2026 results after the bell Tuesday. Analysts project revenue of $19.08 billion, a 20% increase from a year earlier, with non-GAAP earnings per share of $1.96, according to the Zacks Consensus Estimate. Oracle has beaten consensus estimates in each of the past four quarters, averaging an 11.9% earnings surprise.

The contract underscores Oracle's deepening relationship with the federal government under the Trump administration, which has accelerated technology modernization across agencies. The Department of Veterans Affairs this month deployed Oracle's electronic health record system to four medical centers in Ohio and Kentucky, bringing the total to eight of 13 planned deployments this year. The VA said it has fixed "hundreds of problems" at the six original deployment sites and plans to hire 400 staffers to support the rollout.

Federal cloud momentum builds

Oracle's cloud application business has been a key growth driver. In the fiscal third quarter, cloud applications revenue rose 11% in constant currency to a $16.1 billion annualized run rate, with Fusion ERP up 14%, Fusion SCM and HCM each up 15%, and NetSuite up 11%. The company entered the fourth quarter targeting 22 live AWS regions for its multicloud database service, up from eight at the end of the third quarter, and in April expanded its multicloud networking partnership with AWS.

The HR contract positions Oracle's cloud platform as a replacement for legacy government systems, a market where Workday has traditionally held a strong position. Workday reported $2.1 billion in revenue for its most recent quarter, with subscription revenue growing 17% year over year. Oracle's federal wins could pressure Workday's government pipeline, though the full scope and value of the HR contract have not yet been disclosed.

Oracle shares have gained roughly 30% over the past 12 months, outperforming the S&P 500's 14% advance. The stock trades at about 27 times forward earnings, a discount to Workday's 35 times multiple, reflecting investor skepticism about Oracle's ability to sustain cloud growth amid competition from Microsoft and Amazon Web Services. Tuesday's earnings report will provide the next test of whether federal momentum is translating into financial results.

This article is for informational purposes only and does not constitute investment advice.