I'm starting to think that there's a grain of truth in Oracle's (NASDAQ:ORCL) very name. Don't you need to be clairvoyant for real to keep growing your business the way Larry Ellison and his troops have been doing for years on end?

Last night's first-quarter report was no exception. Oracle grew sales 18% year over year to $5.3 billion, while GAAP earnings took a 28% leap to $0.21 per share. The database giant's gross margin has remained above 70% every year since 2000, as unbelievable as that sounds, allowing Larry to invest heavily in research and sales staff without damaging the bottom line. And so the rich get richer, armed with an ever-growing arsenal of products, services, and salespeople.

See, it doesn't really take magical powers of precognition to make this happen. As Larry explained in the earnings call, the secret sauce is economies of scale: "The fact that we sell more databases than anybody else means we can invest more in improving our database, and every year that our database increases in market share, we can increase our investment in engineering and increase our profitability, increase the margin of our database business."

According to technology research firm Gartner (NYSE:IT), Oracle owned 49% of the enterprise database market in 2007. "We are larger than IBM (NYSE:IBM) plus Microsoft (NASDAQ:MSFT) plus Teradata (NYSE:TDC) plus Sybase (NYSE:SY)," Ellison purred with obvious satisfaction. That's up from a 47.1% market share in 2006 and 46.8% the year before that. And in the middleware sector, Larry claims a 35% market share and thinks that he's "either passed IBM or we are about to pass IBM in the middleware business." That means more middleware investments, again outpacing the rest of the industry and widening the gap even more.

Oracle's acquisition strategy makes a lot of sense if you view it in this light. Push your way to the top of the heap by hook or by crook, and then reap the benefits of that lonely view. It's working very well for Oracle, and this stock should bring its market-thumping 16% annual returns for years to come. Don't change a winning strategy, Larry.

Further Foolishness:

Microsoft is a Motley Fool Inside Value recommendation. Try any of our Foolish newsletters today, free for 30 days.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. You can check out Anders' holdings if you like, and Foolish disclosure can hook and crook with the best of 'em.