The agreement has a five-year base value of $3.31 billion and includes a five-year option period. If exercised in full, the contract value would rise to $6.99 billion.
The Department of the Navy negotiated the agreement on behalf of the wider department. The government described it as its first direct-award contract with Oracle for department-wide on-premises Oracle usage.
The contract is intended to replace fragmented software purchases with a single enterprise procurement vehicle. The department said the structure will improve visibility into software usage and spending across participating organizations.
“This nearly $7 billion agreement with Oracle strengthens our digital ecosystem, supporting our warfighters with secure, scalable technology to dominate current and future missions,” said Honorable Kirsten A. Davies, Chief Information Officer for the Department of War. She said the agreement is intended to improve how the department procures on-premises Oracle capabilities.
The agreement supports the entire Department of War as well as the Coast Guard and Intelligence Community. Participating organizations will be able to place orders under a common contracting framework.
Those orders can include Oracle on-premises software and support, Software-as-a-Service applications and professional services. Pricing, deliverables and performance criteria will be set at the individual order level.
“For the Department of the Navy, this agreement supports faster delivery of secure, scalable software from the shore enterprise to the tactical edge for our Navy and Marine Corps teams,” said Barry Tanner, Performing the Duties of the Department of the Navy Chief Information Officer. “Reducing fragmented procurement and advancing enterprise standardization will strengthen interoperability, reduce cybersecurity risk, and help us focus resources on resilient capabilities that can scale, integrate, and endure in contested conditions.”
Oracle said the contract will provide a more standardized path to its commercial products and services. The company said that includes cloud, artificial intelligence, on-premises software and professional services.
“For the Department of War, the challenge is not just finding the right technology, it’s doing so quickly, compliantly, and at scale, without getting bogged down by complex procurement processes,” said Kim Lynch, executive vice president, Government, Defense & Intelligence, Oracle. “ESI is designed to address those challenges by creating a more standardized and efficient path to Oracle cloud and AI technology tuned to support mission-critical scenarios.”
Oracle has supplied technology to the department since the 1990s. The Department of War is expected to transition to the Enterprise Software Initiative contract vehicle in the summer of 2026.
Oracle will provide dedicated program operations and standardized intake processes during the transition. The company said the support will help route requests more efficiently and provide consistent engagement across Oracle teams.
The agreement gives the Department of War a long-term vehicle for consolidating Oracle procurement across a broad defense enterprise. It also ties software standardization to faster technology delivery, cybersecurity requirements and wider defense modernization efforts.
