Cloud is a concept which includes various components. You could refer following url for understanding Cloud in common,
Fusion Applications resides on Oracle Cloud
Hence unlike the Oracle EBS On Premise which used to be hosted on servers/data centers in client premises, the Oracle Fusion Applications for a client are stored in remote servers and hence the term 'Cloud'.
Hope this helps
Fusion can also be installed on-premise too though - which is how it started out. Similarly EBS can be in the cloud.
I'd imagine the question being asked is "if I buy Fusion on-premise with an HCM licence, how is that different from an HCM cloud product"?
They are very similar - fusion is the baseline of cloud offerings, however the versions for on-premise and cloud differ. You'll probably struggle to find an Oracle Sales guy who'll sell you on-premise over cloud.