Oracle's Q2 nicked by income drop
Larry is happy PeopleSoft users are happy
Oracle failed to impress investors with a second quarter that saw profits decline and currency effects punish the company's bottom line.
The database maker posted revenue of $3.3bn – a solid 19 per cent year-over-year increase. Net income, however, dipped 2 per cent to $798m. Part of the disappointing results could be attributed to "currency moving during the quarter nearly 5 per cent in the wrong direction," according to Oracle's CFO Safra Catz.
Oracle also disappointed investors three months earlier when flat database sales marred its first quarter.
Oracle noted that second quarter software revenue increased 18 per cent to $2.6bn. New database and middleware license revenue only increased 5 per cent year-over-year, while applications new license revenue surged 24 per cent to $266m. Services revenue jumped 26 per cent to $675m.
Fancy suit Larry ignored the immediate financial results to turn the focus back on Oracle's PeopleSoft buy.
"Since our acquisition, customers running PeopleSoft products have registered substantially improved satisfaction levels," said Oracle CEO, Larry Ellison. "As a result those customers are now renewing their support contracts at a higher rate than when PeopleSoft was a stand-alone company. Nobody predicted that. They're happy, we're happy."
Oracle expects third quarter revenue to come in between $3.4bn and $3.5bn with earnings per share of 19 cents – or one penny below the current analysts' estimate. ®