Oracle Corp. reported quarterly sales in line with analysts\u2019 estimates after its cloud business failed to meet expectations for higher growth. The shares declined in extended trading.<\/p>\n
Fiscal third-quarter revenue increased 18% to $12.4 billion, just short of analysts\u2019 average estimate of $12.41 billion, according to data compiled by Bloomberg.<\/p>\n
Profit, excluding some items, was $1.22 a share. Analysts, on average, projected $1.20 a share.<\/p>\n
Cloud revenue \u2014 the highly watched segment that Oracle has been trying to expand \u2014 rose 45% to $4.1 billion in the period ended Feb. 28, the Austin, Texas-based company said Thursday in a statement.<\/p>\n
While Oracle\u2019s cloud infrastructure business \u2014 renting computing power and storage \u2014 has been a relative laggard in the market, analysts have been optimistic the services are gaining customers and helping accelerate growth.<\/p>\n
The software giant has employed aggressive marketing and favourable pricing in an attempt to win clients from larger competitors Microsoft Corp. and Amazon.com Inc., which have seen cloud division growth slowdowns<\/a><\/strong>\u00a0in recent quarters.<\/p>\n Large cloud deals, including one announced with Uber Technologies Inc., increased investor excitement ahead of earnings, wrote JP Morgan\u2019s Mark Murphy.<\/p>\n Analysts at Mizuho Securities said in advance of the results that Wall Street\u2019s estimates for Oracle\u2019s cloud business \u201cappear conservative.\u201d<\/p>\n But the results looked like \u201ca little bit of a disappointment,\u201d Dan Morgan, senior portfolio manager at Synovus Trust, said in an interview with Bloomberg Television.<\/p>\n Tyler Radke, an analyst at Citigroup Inc., said the numbers also may indicate weaker demand for information technology amid continuing economic uncertainty.<\/p>\n Shares fell about 4% in extended trading after closing at $86.87 in New York. Oracle has been one of the steadiest tech stocks over the last year, rising 14% during the past 12 months.<\/p>\n Sales will increase about 16% in the current period ending in May, Chief Executive Officer Safra Catz said on a conference call after the results. The outlook is in line with estimates. Profit, excluding some items, will be $1.56 a share to $1.60 a share, she added. Analysts, on average, projected $1.45 a share.<\/p>\n \u201cWe continue to believe the company is navigating the slowdown better than most large rivals,\u201d wrote Bloomberg Intelligence\u2019s Anurag Rana.<\/p>\n \u201cWhile we are pleased with this early success of the Cerner business, we expect the signing of new health care contracts to accelerate over the next few quarters,\u201d Ellison said in the statement.<\/p>\n Catz said the division\u2019s operating margin has increased over 5 percentage points since the acquisition.<\/p>\n More than two-thirds of Oracle\u2019s cloud revenue is generated by business applications such as Fusion software for managing corporate finances and NetSuite\u2019s enterprise planning tools, which are targeted at small- and mid-size companies.<\/p>\n Fusion sales increased 25% in the quarter, compared with 23% growth in the previous period.<\/p>\n NetSuite revenue jumped 23%, compared with 25% in the fiscal second quarter.<\/p>\n Oracle increased its dividend 25% to 40 cents a share. Ellison, the company\u2019s largest shareholder, \u201cdid not participate in the deliberation or the vote on this matter,\u201d the company said.<\/p>\n The additional 8 cents a share in quarterly dividends is set to make Ellison about $91.6 million, based on his ownership of more than 1.14 billion shares disclosed at the end of December.<\/p>\n While Oracle\u2019s cloud infrastructure business \u2014 renting computing power and storage \u2014 has been a relative laggard in the market, analysts have been optimistic the services are gaining customers and helping accelerate growth.<\/p>\n","protected":false},"author":341034,"featured_media":472817,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[25],"tags":[35258,3372,75628],"class_list":["post-483305","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cloud-hosting","tag-cloud-services","tag-oracle","tag-oracle-cloud"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/483305"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/341034"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=483305"}],"version-history":[{"count":0,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/483305\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/472817"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=483305"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=483305"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=483305"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Now read: Google One adds VPN access to all plans<\/a><\/h2>\n","protected":false},"excerpt":{"rendered":"