Oracle Posts Strong Q1: Hurd Touts New High-End Systems

Sep.16.10 | About: Oracle Corporation (ORCL)

Oracle (NASDAQ:ORCL) handily topped expectations for both first quarter earnings and revenue as the company said its hardware business “grew faster than expected.”

The company reported first quarter earnings of $1.4 billion, or 27 cents a share, on revenue of $7.5 billion, up 48 percent from a year ago. Non-GAAP earnings were 42 cents a share. Wall Street was looking for earnings of 37 cents a share on revenue of $7.3 billion.

According to Oracle, both the software and hardware businesses performed better than expected. Both co-presidents, Safra Catz and Mark Hurd, were quoted in a statement. Catz said:

Our software business grew strongly in all regions with new license sales up 25%. Our hardware business also grew faster than we expected with Sun Solaris servers and Exadata leading the way.

Hurd, who just joined the company, previewed Oracle OpenWorld:

Next week at Oracle OpenWorld we will announce two new high-end systems that combine Sun hardware with Oracle software.

Hurd also touted Oracle’s R&D spending for the year. At HP, Hurd was knocked for scrimping on R&D.

CEO Larry Ellison said the Exadata pipeline tops $1.5 billion, up from $1 billion a quarter ago. The pipeline, however, doesn’t reflect actual sales.

By the numbers:

  • New software license revenue was up 25 percent from a year ago to $1.28 billion.
  • Updates and support revenue was $3.45 billion, up 11 percent from a year ago.
  • Hardware systems revenue was $1.7 billion, or 8 percent of revenue.
  • Services revenue was $1.06 billion, up 18 percent from a year ago.
  • Revenue in the Americas was $3.9 billion followed by $2.38 billion in Europe, Middle East and Africa and $1.2 billion in Asia Pacific.
  • Database and middleware revenue was $3.25 billion, up 17 percent from a year ago.
  • Applications revenue was $1.48 billion, up 8 percent from a year ago.

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