Oracle license growth hits guidance, hardware sales miss


Oracle's (ORCL) software license/cloud subscription revenue rose 4% Y/Y in FQ1 to $1.66B. The growth rate is better than FQ4's disappointing 1%, and hit a guidance range of -1% to +7%. But hardware product sales fell 14% Y/Y to $669M, missing a guidance range of -6% to +2%. 60% engineered system sales growth apparently failed to offset plunging SPARC/UNIX server sales.

Software license update/product support revenue (flows from existing license deals) rose 7% Y/Y to $4.43B, up from 6% in FQ4.

$3B was spent on buybacks, up from FQ4's $2.8B and allowing EPS to beat estimates in spite of a revenue miss.

Americas sales rose 4% Y/Y to $4.52B, aided by 14% growth in software licenses/cloud subscriptions. EMEA +2% to $2.44B, but with a 4% license/subscription drop. Thanks in large part to forex, Asia-Pac revenue -4% to $1.42B, licenses/subscriptions -5%.

Opex +4% Y/Y, outpacing rev. growth of 2%. An 11% increase in sales/marketing spend to $1.71B offset lower G&A and hardware-related expenses.

ORCL +0.8% AH. CC at 5PM ET, guidance should be provided.

FQ1 results, PR

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Comments (1)
  • Phil64
    , contributor
    Comments (23) | Send Message
     
    Note that Oracle's SPARC/UNIX server sales is NOT plunging as stated. Oracle's Engineered Systems are partly based on SPARC/UNIX which had a 60% sales growth and Oracle's SPARC T-Series as stated by Mark Hurd during the Q1 2014 Results Earnings Call stated "T was okay in the quarter, M was not. So as you know, in sort of Q4-ish timeframe, mid-Q4, we released a new set of M products (SPARC M5) we're pretty excited about. We've got a big installed base that we can move. It takes time to get those products certified and tested in customers' environments, but that's what happened in the numbers". http://bit.ly/1gDafQb
    19 Sep 2013, 10:21 AM Reply Like
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