Oracle says bleeding will stop
Published: 14 Nov 2002 11:09 GMT
The chief financial officer at Oracle on Monday said 2003 should mark the end of nearly two years of revenue declines for the software maker.
"Two years is a long time, even with a correction like this," Oracle chief financial officer Jeff Henley said, referring to technology revenues that continue to shrink on the heels of the still-unwinding Internet and telecom busts.
"During the first half of calendar 2003, we'll start to see this thing turn around," Henley said at OracleWorld, the database giant's technology and user conference being held in San Francisco this week.
After that, Henley said he expects his company to "return to positive revenue growth".
Henley sees that uptick stemming from easier comparisons against prior-year results and from pent-up demand.
"Companies are working off a lot of their projects and are ready for new projects," he said.
High-tech shops have suffered as big corporate customers -- who spent lavishly during the boom -- slashed spending in response to what started as a stock market correction in the United States and has since morphed into a global business slowdown.
For its part, Silicon Valley-based Oracle has seen sales fall for six straight quarters -- a phenomenon that prompted Henley to deem this the worst technology recession since the mid-1970s.
Henley repeated the company's estimates for second-quarter earnings of 8 cents to 9 cents a share, compared with a 10-cent per share profit in the year-ago quarter. Oracle last traded after hours at $9.20 (£6), up from its close at $9.05.
Henley -- who was working in the semiconductor industry during the last severe tech downturn -- noted similarities between that bust of three decades ago and high tech's current woes. In both cases, the economy was weak and pet stocks had crashed after reaching spectacular heights, he said.
The difference is that the recent tech bubble was larger and technology is far more pervasive, he said. "People tend to forget...that technology is a cyclical industry," Henley said. "Our assumption is that the worst is over."
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