- Summary: Following a strong showing in June, analysts are expecting Oracle (ORCL) to report strong revenue growth when reports fiscal first quarter results tomorrow. A jump in revenue could be an indication that Oracle is increasing its market share at SAP’s (SAP) expense. Oracle’s rising fortunes are regarded as a triumph for CEO Larry Ellison’s “right hand man”, Co-President Chuck Phillips. In the past, Oracle had the reputation of phasing out software products it acquired – pushing companies (using the acquired product) to switch to Oracle’s home-grown competing product. When Oracle purchased PeopleSoft, PeopleSoft users braced for what they felt was the inevitable. Enter Mr. Phillips. In 2005 he promised customers that Oracle would continue development on programs they acquired, thereby not forcing them to switch to Oracle’s products. This change in direction helped Oracle calm the fears of customers as it launched a $20 billion acquisition spree which included Siebel Systems and Retek.
- Comment on related stocks/ETFs: As updates and product support become an increasing source of Oracle’s revenue, “being nice” to their customers becomes crucial to their continued success. Cramer notes that Oracle would really have to make a dire miscalcuation to lose points from rival SAP.
Related: Oracle’s 2006 second quarter conference call transcript.
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