Oracle Misses Q4 Estimates, Shares Drop

Shares of

dipped over 6 percent in after-hours trading after the company reported weaker-than-expected results for its fiscal fourth quarter. The Redwood City, California-based company reported quarterly net income of $2.76 billion, or $0.62 per share, versus a year-ago profit of $3.65 billion, or $0.80 per share. Its non-GAAP earnings dropped 14 percent to $0.78 per share. Its total revenue slipped 5 percent year-over-year to $10.71 billion. The company's revenue would have been up 3 percent without the strengthening of the U.S. dollar. However, analysts were expecting earnings of $0.87 per share on revenue of $10.95 billion. The average estimate among 55 Estimize users was for earnings of $0.90 per share and revenue of $11.11 billion. Software and Cloud revenue shrank 6 percent year-over-year to $8.4 billion in the quarter, while Cloud software as a service and platform as a service revenue climbed 29 percent to $416 million. Cloud infrastructure as a service revenue jumped 25 percent to $160 million, while Hardware Systems revenue slipped 4 percent to $1.4 billion in the latest quarter. Oracle's operating income came in at $4.0 billion in the quarter, while operating margin was 37 percent. The company's board declared a quarterly cash dividend of $0.15 per share of outstanding common stock. "We sold an astonishing $426 million of new SaaS and PaaS annually recurring cloud subscription revenue in Q4," said Oracle CEO, Safra Catz. "We expect our rapidly increasing cloud sales to quickly translate into significantly more revenue and profits for Oracle Corporation. For example, SaaS and PaaS revenues grew at a 34% constant currency rate in our just completed Q4, but we expect that revenue growth rate to jump to around 60% in constant currency this new fiscal year." "We expect to book between $1.5 and $2.0 billion of new SaaS and PaaS business this fiscal year," said Oracle Executive Chairman and CTO Larry Ellison. Oracle shares fell 6.31 percent to $42.08 in the after-hours trading session.