Oracle reported Q3 net income increased 35% to $1.03 billion, or $0.20/share, on a 27% rise in revenue to $4.41b. Excluding certain items, EPS totaled $0.25, topping analysts' average estimates of $0.22 (Bloomberg) and $0.23 (Thomson). Oracle CFO Safra Catz told reporters "the business is hitting on all cylinders" and in the firm's conference call said, it was its "fastest growing Q3 in more than five years with obvious market share gains across all product segments." Sales of new software licenses increased 27% to $1.39b, beating its own guidance of 16% - 20%, the latter which CFO Catz called "aggressive" in itself. Oracle expects Q4 EPS of $0.34 excluding certain items, in-line with analysts' average estimate. Q4 guidance does not include Hyperion since the $3.3b deal announced earlier this month hasn't closed yet. Oracle's shares gained 2.15% to $17.55 in normal trading yesterday and last traded at $18.15 (+3.4%) following its earnings release on volume approaching 10 million.
Sources: Oracle F3Q07 Earnings Call Transcript, Press release [pdf], Associated Press, Bloomberg
Commentary: Could BEA Systems Be in Oracle's Sights? • Oracle: Street Gets Increasingly Optimistic On FY Q3 Results • Oracle to Buy Hyperion Solutions for $3.3B Cash -- NYT
Stocks/ETFs to watch: Oracle (ORCL). Competitors: SAP (SAP), IBM (IBM), Microsoft (MSFT). ETFs: iShares Goldman Sachs Software Index Fund (IGV), Software HOLDRS Trust ETF (SWH), PowerShares Dynamic Software (PSJ)
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