Oracle cuts jobs in Internet rejig

Soaring sales

Oracle is slashing 325 jobs, around one per cent of its workforce, in a rejig to focus on the Internet. The company's quarterly profits easily beat market expectations yesterday, thanks to a boost in database sales. The software maker saw profit jump 31 per cent to $527.4 million, or 36 cents a share, for the fourth quarter ended May 31. This compared to $402.8 million, or 27 cents, a year ago. Sales were up 22 per cent at $2.94 billion from $2.41 billion. Analysts had expected the California-based giant to earn 32 cents per share, according to First Call. Oracle said sales in its software, which helps companies automate manufacturing, payroll and finances, had bolstered results. This quarter is traditionally the strongest for Oracle. But it reported slower than usual growth for its third quarter, and there were fears that it might disappoint investors again. Share prices climbed to $29.50 in after-hours trading, after falling 5 per cent to $25.13 yesterday before the results were announced. Licence sales, or new software revenue, in Oracle's applications business rose 28 per cent to $277.2 million from the same period last year. New sales of database software increased 21 per cent to $1.21 billion, with database services revenues also rising 21 per cent to $971 million. For the full year, Oracle posted $1.29 billion net income, or 87 cents a share, up from $813.7 million, or 54 cents a share. Sales were up to $8.83 billion, from $7.14 billion. "When you blow through the numbers like that, you've got to feel pretty good," Christopher Shilakes, analyst at San Francisco in Merrill Lynch said. Other analysts cautioned that the real challenge lay in Oracle getting consistency in its results. "Oracle hasn't historically had a terrific track record on that score," said Andrew Brosseau, analyst at SG Cowen. ®

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