Oracle tops estimates in second quarter
Published: 15 Dec 2000 12:14 GMT
Oracle reported better-than-expected second-quarter results, Thursday, on the strength of database and business software sales.
The database giant earned a second-quarter profit of $623m, or 11 cents a share, compared to last year's second-quarter profit of $384m, or 6 cents per share.
Wall Street had predicted earnings of 10 cents a share, according to a poll of analysts by First Call/Thomson Financial.
For the second quarter, that ended November 30, revenue grew from $2.3bn, in 1999 to $2.7bn, this year.
Oracle's strong financial results is good news for the technology sector, which has been hit hard recently by profit warning after profit warning. In the past two weeks, Apple, Compaq, Intel, Motorola and 3Com have all warned of earning shortfalls for their current quarters. Microsoft, on Thursday afternoon, also announced an earnings warning.
On a conference call with analysts, CFO Jeff Henley said the company isn't seeing a slowdown in its business. "At this point, we see no impact on our business," said Henley.
Henley said the PC sector is slowing, but Oracle's business isn't affected by the slowdown. "It's important to point out that not all technology companies are the same," he said.
Driving Oracle's revenue growth was a 19 percent year-over-year growth in Oracle's database software business, which serves as the bellwether for the company's financial health. Database sales for the second-quarter reached $775m.
The company's business software revenue jumped 66 percent to $279m, while revenue from consulting and support services grew 9 percent to $1.5bn.
Analysts had predicted that Oracle's second-quarter revenue for databases would increase about 20 percent, year-over-year, while its applications business would grow between 52 to 54 percent.
Analysts had said it was important for Oracle to post strong business software sales after revenue from applications fell short of Wall Street expectations last quarter.
Oracle sells an e-business suite of software that includes accounting, human resources and manufacturing applications, as well as customer relationship management (CRM) software, that automates a company's sales, marketing and other customer needs.
Applications sales last quarter grew only 42 percent, far below the 70 percent growth analysts had expected.
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