Seeking Alpha
Profile| Send Message| ()  
Oracle (ORCL) is flat out on fire. The company Tuesday afternoon reported results for the fiscal first quarter ended August 31 which blew away expectations across the board. Revenue totalled $3.6 bilion, nicely ahead of the Street consensus of $3.47 billion. The company reported 13 cents a share in GAAP profits, or 18 cents on a non-GAAP basis; both were several pennies ahead of Street projections. Database and license revenue grew 15%; application revenue grew 80%; services revenue was up 33%.

In its press release announcing the numbers, Oracle President and CFO Safra Catz said that the company “exceeded our guidance on every metric…we are now in year three of our five-year plan targeting EPS growth at 20% per year.”

It was in many ways an only-from-Oracle kind of news release, taking absolute joy in poking its finger in the eye of rival SAP (SAP).

“We’re rapidly taking applications market share from SAP,” Oracle President Charles Phillips said in the release. “Q1 was the second consecutive quarter that Oracle’s applications new license sales growth was 80% or more. That’s ten times SAP’s 8% new license sales growth rate in their most recently completed quarter.”

And then they throw in another poke, courtesy of Chairman Larry Ellison:

SAP appears to be rethinking their strategy as they lose application market share to Oracle and confront the difficulties of moving their application software to a modern Service Oriented Architecture [SOA],” said Ellison in the release. “They’ve just announced that they are delaying the next version of SAP applications until 2010. That’s a full two years behind Oracle’s scheduled delivery of our SOA Fusion applications. And now [SAP CEO Henning] Kagermann is talking about an acquisition strategy to augment SAP’s slowing organic growth. These are major changes in direction for SAP.

Investors are almost as gleeful about the quarter as Oracle’s execs. In after hours trading, the stock is up $2.15, or 13.3%, to $18.28. If that price holds up tomorrow, it will be a new 52-week high for the software giant, and its highest share price in more than five years. The after hours gain represents an increase in Oracle’s market cap of more than $11 billion. The stock is now up about 50% for the year to date.

The Oracle news, despite the company’s fun at SAP’s expense, has actually given a lift to the German company’s stock as well: SAP shares after hours have gained 13 cents to $47.99, presumably on the assumption that the Oracle news has broader ramifications for the enterprise software market.

Previously: Oracle reported a big beat in the fourth quarter, as well.

Comment on this article

Source: Oracle's On Fire: Reports Another Blowout Quarter, Pokes SAP in the Eye