Oracle’s cloud business was the highlight of the company’s fourth quarter earnings reported Thursday.
Revenue from Oracle's cloud-computing software and platform service rose more than 49% to $859 million in the FY16 fourth quarter, which ended May 31.
Oracle’s co-CEO Mark Hurd said in the fourth quarter the company gained more than 1,600 new cloud software as a service (SaaS) customers and more than 2,000 new platform as a service (PaaS) customers.
For the fiscal year 2016 overall, Oracle reported total revenues were down 3%. But cloud SaaS and PaaS revenues reached $2.2 billion, up 49%.
"We dramatically overachieved again in the cloud," Oracle co-CEO Safra Catz said.
Meanwhile, software revenues were flat at $8.4 billion. In the software space, Oracle has faced tough competition from newer companies such as Workday and Salesforce.
But cloud is seeing dramatic growth overall. An April report from International Data Corporation predicted public cloud growth of approximately 14% to $24.4 billion in 2016, while a May report from Synergy Research found that the overall cloud market grew by an astonishing 50% in the first quarter of 2016.
Catz said Oracle expects the company’s cloud business to grow more than 65% in fiscal 2017.
But accounting for cloud computing sales has proven challenging for tech companies, because it’s not always clear what is—or what should be—included in cloud numbers. Some companies might include the hardware like servers and routers they make as part of their cloud revenue, while others might include software. Cloud computing figures are therefore not given much credence in the market overall.
Oracle's cloud accounting has recently come under scrutiny after a former finance manager filed a lawsuit alleging the company asked her to falsify accounting numbers for its cloud business. An Oracle spokeswoman told Fortune that its cloud accounting is “proper and correct” and that the company plans to countersue.