Dec. 9, 2021
Here is the article.
(Bloomberg) -- Oracle Corp. reported better-than-expected
quarterly revenue, buoyed by strong cloud sales and increased corporate demand
for information technology. Shares rose about 10% in extended trading.
Sales increased 5.7% to $10.4 billion in the fiscal second
quarter, the Austin, Texas-based company said Thursday in a statement.
Analysts, on average, projected $10.2 billion, according to data compiled by
Bloomberg. Profit, excluding some items, was $1.21 a share, compared with the
average estimate of $1.11 per share.
The results add momentum for Oracle, the world’s second-largest software maker by revenue, which has tried for years to expand its cloud computing
business and close a big gap in market share to Amazon.com Inc., Alphabet
Inc.’s Google and Microsoft Corp. The revenue gains marked the sixth straight
quarter of year-over-year sales increases for the company.
“These strong results are being driven by the 22% growth of
our infrastructure and applications cloud businesses, which are approaching $11
billion in annualized revenue,” Chief Executive Officer Safra Catz said in the
statement.
Catz gave forecasts for revenue and profit suggesting the
company is on a similar path in the current period. Fiscal third-quarter
earnings will be $1.14 to $1.18 a share, in line with analysts’ estimates.
Revenue will increase 3% to 5%, she said during a conference call after the
results. Analysts’ projected 5% growth to $10.6 billion.
In
the second quarter, revenue from cloud services and license support increased
6% to $7.55 billion, topping analysts’ estimates of $7.52 billion. That metric
includes sales from hosting customers’ data in the cloud, but a large portion
is generated by maintenance fees for traditional software kept on clients’
corporate servers.
Cloud
license and on-premise license sales gained 13% to $1.24 billion in the period
ended Nov. 30. Analysts had expected $1.1 billion.
Notably,
sales of Fusion and NetSuite -- its two enterprise resource planning, or ERP,
products -- increased 35% and 29%, respectively. That business is critically
important to Oracle’s future growth. Most companies are unlikely to change an
ERP system, which is made up of complex programs that touch on many different
areas of a business, as easily as narrower applications, like software to
manage personnel.
“That’s
where they want to see their growth,” said Trevor White, research manager at
Nucleus Research Inc. It “allows Oracle a strong opportunity to cross-sell into
other areas.”
Shares
jumped to a high of $98.70 in extended trading after closing at $88.77 in New
York. The stock has climbed 37% this year.
Oracle also said it increased the authorization for its share buyback program by $10 billion.
No comments:
Post a Comment