Oracle Corporation (ORCL) - NYSE
  • Oct. 29, 2015, 1:21 AM
    • As expected, Oracle (NYSE:ORCL) has used its annual OpenWorld conference to roll out new cloud infrastructure (IaaS) services meant to put it on better footing against Amazon, Microsoft, IBM, and a slew of other rivals when battling for enterprise accounts.
    • The offerings include the ability to choose between pay-as-you-go and dedicated compute capacity (long supported by many rivals), storage services focused on file-sharing and archived data, support for Docker containers, and high-performance connectivity options for interacting with customer data centers. Among these is support for direct links between Oracle's cloud and facilities owned by major data center owner Equinix in six markets.
    • Oracle's IaaS revenue rose 16% Y/Y in the August quarter to $160M. However, that's a small fraction of the $2.09B in revenue (+78% Y/Y) claimed by IaaS leader Amazon Web Services in Q3. HP recently bowed out of the public IaaS market, while VMware and parent EMC recently pooled their IaaS assets into a JV under the Virtustream brand. The rapid growth of Amazon's database services - they're now on a $1B/year run-rate, and support several database platforms - is viewed as a long-term threat to Oracle's mainstay database business.
    • Also launching: A Data Visualization Cloud Service that targets a fast-growing market for analytics tools that can be used by non-IT workers. Rivals in this space include Microsoft, Qlik, Tableau, and more recently Amazon and SAP. Oracle claims tight integration with its existing analytics offerings, and support for many Oracle and non-Oracle data sources.
    • Other new cloud offerings: 1) New high-reliability features for Oracle's cloud database services, as well as a service for running databases and data warehouses on Oracle's Exadata systems. 2) Management Cloud, a set of apps for monitoring app performance, analyzing log data, and overseeing a company's IT infrastructure. 3) New services for creating Java-based cloud apps. 4) New apps and features for Oracle's cloud ERP software suite, including three supply chain management apps.
    • Oracle's cloud app and app platform (SaaS/PaaS) business is much larger than its IaaS business: SaaS/PasS billings rose 70% Y/Y in the August quarter to $592M. Traditional software license revenue fell 16% to $1.15B.
    | Oct. 29, 2015, 1:21 AM | 2 Comments
  • Oct. 28, 2015, 4:25 PM
    • Equinix (NASDAQ:EQIX) is off 2% in choppy trading after hours in the wake of posting Q3 results where revenues and FFO grew solidly though EPS fell short of consensus.
    • Adjusted FFO was up to $210.4M, but net income came to $0.71/share vs. an expected $1.11. Revenues were up 10.7% Y/Y and up 3% sequentially. Recurring revenues (co-location, interconnection, managed services) were up 10% Y/Y to $646.7M.
    • Gross margins were 53% compared to a year-ago 51%.
    • The company also announced a deal with Oracle (NYSE:ORCL) to bring Oracle's Cloud services to six global markets via the Equinix Cloud Exchange: Amsterdam, Chicago, London, Singapore, Sydney and Washington, D.C. Cloud is the fastest-growing part of Oracle's business, supporting 62M users and 23B transactions a day.
    • Equinix is guiding to Q4 revenues of $701M-$705M vs. consensus of $701M. It expects Q4 EBITDA of $328M-$332M vs. an expected $327M. It sees full-year 2015 revenues of $2.696B-$2.7B, above consensus of $2.693B, and EBITDA of $1.267B-$1.271B, above an expected $1.26B.
    • Conference call to come at 5:30 p.m. ET.
    | Oct. 28, 2015, 4:25 PM
  • Oct. 19, 2015, 11:27 AM
    • Arguing the transition to cloud subscriptions will have a larger impact on near-term license/maintenance revenue than previously forecast, Pac Crest's Brendan Barnicle has downgraded Oracle (ORCL -1.9%) to Sector Weight.
    • Barnicle's FY16 (ends May '16) revenue and EPS estimates have respectively been cut by $800M and $0.14 to $37.2B and $2.56. Consensus is at $37.8B and $2.62. In September, Oracle guided for 3%-4% FY16 constant currency software/cloud revenue growth, with SaaS/PaaS cloud revenue rising 50% and on-premise software revenue rising 0%-1%.
    • JMP downgraded last week on concerns about growing competition from Amazon. Shares are less than $2 away from a 52-week low of $35.14.
    • In other news, Oracle says it now has over 1,300 customers (only 300+ in production for now) for its cloud ERP apps. Clients include Athenahealth, Evite, and Irving Materials.
    • NetSuite (N +0.7%) is a major player in the SMB cloud ERP software space. Meanwhile, on-premise ERP giant SAP made its core apps available via cloud subscriptions last year. Large enterprises have generally been more cautious about adopting cloud ERP apps than they have been about adopting cloud CRM and HR apps.
    | Oct. 19, 2015, 11:27 AM | 2 Comments
  • Oct. 14, 2015, 10:26 AM
    • A day after downgrading VMware on fears Amazon Web Services (AWS) will take a toll, JMP's Patrick Walravens has done the same for Oracle (ORCL -1.1%), cutting shares to Underperform and setting a $31 target.
    • Walravens notes AWS recently disclosed its database business is on a $1B/year run rate, and has seen 127% Y/Y usage growth. Amazon (NASDAQ:AMZN) is 11 months removed from launching a "commercial-grade" database (known as Aurora) that targeted Oracle, and a week removed from unveiling a database migration service and storage transfer appliance for enterprises looking to move workloads to AWS.
    • He adds there's "increasing customer dissatisfaction" with Oracle's pricing and auditing policies (previous), and that some of Oracle's cloud deals stem from major sales incentives and "may not go live."
    • Separately, Oracle has been awarded $50M in a copyright infringement lawsuit against Rimini Street, a provider of 3rd-party maintenance/support services for companies using Oracle and SAP's software. Oracle had sought $245.9M; Rimini, which might appeal, argued it should only pay $10M.
    • The legality of Rimini Street's services wasn't on trial, and Rimini insists the suit covered "processes no longer in use." Oracle's ongoing battle with Rimini has been closely watched due to the potential of 3rd-party firms to eat into Oracle and SAP's cash-cow maintenance/support businesses. Oracle's license update/product support revenue totaled $4.7B in the August quarter, or 56% of revenue.
    | Oct. 14, 2015, 10:26 AM | 5 Comments
  • Sep. 16, 2015, 5:36 PM
    | Sep. 16, 2015, 5:36 PM
  • Sep. 16, 2015, 5:29 PM
    • On a constant currency basis, Oracle (NYSE:ORCL) expects FQ2 revenue to be down 2% to up 1% Y/Y, and EPS to be in a range of $0.63-$0.66 - forex is expected to have a 6% impact on revenue growth, and a $0.05 impact on EPS. Consensus in actual dollars is for -0.6% revenue growth and EPS of $0.65.
    • Total software and cloud revenue is expected to be flat to up 2% in constant currency. SaaS/Pass revenue is expected to grow 36%-40%, and IaaS revenue 5%-9%.
    • For the whole of FY16 (ends May '16), Oracle expects 3%-4% CC software/cloud revenue growth, 50% SaaS/PaaS growth, and 0%-1% on-premise software (licenses + update/support revenue) growth.
    • Strong bookings are expected to lead SaaS/PaaS revenue growth to accelerate as FY16 progresses - bookings were up 165% in FQ1 in CC, leading dollar-based billings to rise 70% (well above 34% revenue growth).
    • ORCL -2.4% after hours to $37.35.
    • FQ1 results, details
    | Sep. 16, 2015, 5:29 PM | 4 Comments
  • Sep. 16, 2015, 4:24 PM
    • Oracle's (NYSE:ORCL) cloud + on-premise software revenue totaled $6.5B in FQ1, -2% Y/Y in dollars and +6% in constant currency; guidance was for 6%-8% CC growth.
    • Top-line performance: SaaS/PaaS (cloud app and app platform) revenue rose 34% in dollars to $451M and 38% in CC, slightly missing guidance for 39%-43% CC growth. Traditional software licenses (hurt by cloud adoption) -16% to $1.15B. Software license update/product support (driven by past deals) -1% to $4.7B. Hardware -3% to $1.1B; products -1%, support -5%. IaaS (cloud infrastructure) +16% to $160M. Services +1% to $862M.
    • Americas revenue rose, while EMEA and Asia-Pac (hurt by forex) fell. A strong dollar had a 9% impact on total revenue growth (-2% vs. +7%). SaaS/PaaS bookings are said to be growing at more than a 150% Y/Y clip, which leads Oracle to reiterate it expects $1.5B-$2B worth of FY16 (ends May '16) SaaS/PaaS bookings.
    • Financials: $2.8B was spent on buybacks, helping EPS beat estimates in spite of a revenue miss. Thanks to forex, GAAP costs/expenses rose a modest 3% Y/Y to $5.8B - sales/marketing spend totaled $1.7B (+1%) and R&D $1.4B (+5%). Oracle ended FQ1 with $55.9B in cash/investments (much of it offshore), and $42.1B in debt.
    • ORCL -0.6% after hours to $38.01. Earnings call at 5PM ET (webcast), guidance should be provided.
    • FQ1 results, PR
    | Sep. 16, 2015, 4:24 PM | 1 Comment
  • Sep. 16, 2015, 4:02 PM
    • Oracle (NYSE:ORCL): FQ1 EPS of $0.53 beats by $0.01.
    • Revenue of $8.45B (-1.7% Y/Y) misses by $80M.
    • Shares -1.9%.
    | Sep. 16, 2015, 4:02 PM
  • Sep. 16, 2015, 9:32 AM
    • Citing increasing cloud opportunities and a favorable valuation, SunTrust has upgraded Oracle (ORCL] +0.3%) to Buy ahead of this afternoon's FQ1 report, and set a $48 target.
    • Oracle is down 15% since missing FQ4 estimates, reporting 2% Y/Y constant currency software/cloud revenue growth, and offering light EPS guidance on June 17. Shares go for 14x an FY16 (ends May '16) EPS consensus of $2.71.
    • Update: More details on SunTrust's upgrade here. Analyst John Rizzuto: "[W]e believe that enterprises will increase their technology spending as they adopt cloud solutions, giving Oracle a unique opportunity as a consolidator. ... Importantly, it has re-architected and designed its middleware and database platforms to be more readily extensible to the cloud. We believe this will prove to be a critical differentiator within its customer base. Oracle, like only one or two others, is in a position to transition its customers to the cloud rather than causing disruption in cloud adoption."
    | Sep. 16, 2015, 9:32 AM
  • Sep. 15, 2015, 5:35 PM
  • Sep. 14, 2015, 11:15 AM
    • With market eyes on a Fed rate-hike decision considered to be a bit of a toss-up amid differing opinions, Goldman Sachs is banking on the (slightly) more dovish position that the agency will wait until December. The bank is still laying out how to play the hike when it invariably comes.
    • Strength in balance sheets is what you need, it says, noting that those companies outperform (by an average 5%) in the three months after a rate-boosting cycle begins. In Goldman's "High Quality Stock" basket: CMG, DLTR, PEP, KMI, BLK, GOOG, AAPL, PCLN, ORCL, WFC.
    • Meanwhile, it suggests avoiding companies with high floating-rate debt as they bear the brunt of a move away from near-zero interest rate policy. "When the tightening cycle finally starts, the immediate impact will be felt by firms with high proportions of variable rate borrowing."
    • Included in that "avoid" list: CL, COL, JNJ, AAPL, EBAY, MET, KO, GIS, F, MCD, GM, TWX, CVX, AGN, MON.
    • (Yes, cash-rich Apple made both lists, having a strong balance sheet along with floating debt.)
    | Sep. 14, 2015, 11:15 AM | 70 Comments
  • Aug. 20, 2015, 2:35 PM
    • Maxymiser provides cloud software for testing and personalizing online/mobile ad campaigns, as well as analyzing customer demographics to improve targeting. Clients include HSBC, Allianz, Epson, Wyndham, and Calvin Klein.
    • Oracle (ORCL -1.8%) is buying Maxymiser for an undisclosed sum, and plans to add the company's offerings to its Marketing Cloud platform. In a presentation (.pdf), the company claims Maxymiser "optimizes over 20 billion customer experiences per month for more than 250 prominent brands," and asserts its "Maxymiser’s capabilities in web and mobile channels complement Oracle Marketing Cloud’s strengths in email, SMS, social, push messaging, and display-advertising channels."
    • Past Oracle marketing/CRM acquisitions: Datalogix (online/offline data), BlueKai (marketing data management), Eloqua (cloud marketing automation), Responsys (ditto), Vitrue (social media marketing), Collective Intellect (ditto)
    • Yesterday: Citi estimates Oracle's cloud software ROI relative to traditional licenses
    | Aug. 20, 2015, 2:35 PM
  • Aug. 19, 2015, 7:14 PM
    • An analysis done by Citi's Walter Pritchard (Neutral, $42 target) indicates Oracle (NYSE:ORCL) needs 5 years to generate as much from cloud subscription sales for financials software as it does from traditional up-front licenses, assuming the licenses are discounted by 33% and cloud sales are done at list prices. For HR/HCM and CRM software, the breakeven points respectively rise to 8 and 10 years.
    • Cloud database sales fare better in the analysis, with an estimated breakeven time of 2-5 years. Nonetheless, Pritchard concludes Oracle's management is "too optimistic on profitability of the cloud business."
    • Oracle's FQ4 (May quarter) numbers had already led Pritchard and other analysts to fret about the margin pressures caused by the cloud transition. Jefferies has reported Oracle is pricing its cloud HR/HCM offerings aggressively to take share from market leader Workday, and Business Insider has reported Oracle has begun using the "nuclear option" of issuing breach-of-contract notices to clients - if enforced, such notices can require a client to stop using Oracle's software in 30 days - to get them to buy cloud subscriptions.
    • The transition's effects: Oracle's SaaS/PaaS cloud revenue rose 29% Y/Y in FQ4 to $416M, while its traditional license revenue fell 17% (10% exc. forex) to $3.1B.
    | Aug. 19, 2015, 7:14 PM | 8 Comments
  • Jun. 29, 2015, 6:15 PM
    • Barclays has named enterprise software giant Oracle (NYSE:ORCL), glass giant Corning (NYSE:GLW), network processor/ARM server CPU vendor Cavium (NASDAQ:CAVM), and  payment services provider Total System Services (NYSE:TSS) its top Americas tech picks.
    • On Oracle: "Oracle is emerging from an extended period of product development and internal changes that position it well to capitalize on key tailwinds through 2016. With better execution in software and stabilization in hardware, we think investor sentiment will become more positive, specifically as quarterly results have been better, and the current valuation makes Oracle shares attractive." Shares are less than two weeks removed from selling off due to an FQ4 miss and light guidance.
    • On Corning: "The launch of Gorilla Glass 4 has been successful and additional glass industry dynamics remain beneficial. Other new glass products highlight Corning’s ability to move with the market and compete with non-glass solutions over time. Capital allocation will remain a major component of the story and the company’s large share repurchase program (roughly $1bn remaining) and $0.48 annual dividend should lend support to the stock." Barron's made a bull case earlier this month.
    • On Cavium: "CAVM’s base business is levered to strong end market growth trends within the security, wireless infra, and data center end markets, but we also see [addressable market] expansion through its Fusion-M (doubles base station content and likely drives share gains), Liquid IO (gen 2 ramps 2H15), 2/4 core Octeon (addresses FSL $500+ business), and Fusion (small cell) products. ThunderX (ARM server SoC) and XPliant (switch silicon) both add incremental $1bn+ TAMs with disruptive solutions. CAVM will likely need to weather one more quarter without real upside but multiple products are progressing toward material revenue in 2016." CLSA and Needham cited some of the same catalysts in bullish June notes.
    • On TSS: "Despite recent accounts on file (AOF) wins (e.g., BMO, TD, BAC) TSS expects to be able to grow North American revenue by mid- to-high single digits organically on an annual basis over the longer term. Given strong drivers such as card transactions (Nilson projects transactions on cards to grow ~7% from 2013 to 2018), and AOF outsourcing trends, we see the implied 5-9% y/y longer-term growth guidance as achievable, particularly when combined with nominal GDP growth."
    | Jun. 29, 2015, 6:15 PM
  • Jun. 29, 2015, 10:17 AM
    • The Supreme Court has ruled Oracle (ORCL -0.4%) can press claims Google (GOOG -1%) infringed its copyrights by using Java APIs within Android, turning down a request by Google to hear the case. The dispute will now return to a lower court.
    • Oracle has sought over $1B in damages. Though a district court jury cleared Google in 2012 of infringing 8 Oracle patents, it ruled Google infringed Oracle copyrights. A federal appeals court later declared Oracle's code is eligible for copyright protection, sending the case back to the district court. Google had appealed that decision to the Supreme Court.
    • Google, backed by Yahoo, Red Hat, and HP, has argued granting Oracle's code copyright protection will prevent developers from building on top of past software innovations. Oracle, backed by Microsoft, EMC, and NetApp, has accused Google of plagiarizing its code.
    • Update: Some more Google news: The EU is now giving Google until Aug. 17 to respond to antitrust charges. The WSJ recently reported the EU wants major changes to Google's shopping search rankings.
    | Jun. 29, 2015, 10:17 AM | 4 Comments
  • Jun. 23, 2015, 4:01 AM
    • Oracle (NYSE:ORCL) is expanding its cloud-computing offerings, bringing the company into more direct competition with Amazon Web Services.
    • "We're prepared to compete with Amazon on price," said Executive Chairman Larry Ellison in a webcast, after announcing that Oracle would offer online storage and capability for customers to run their applications entirely in the cloud.
    • The company's cloud business is growing quickly, running at a rate of about $2.3B a year in revenue.
    | Jun. 23, 2015, 4:01 AM
Company Description
Oracle Corp. provides enterprise software and computer hardware products and services. The company is organized into three businesses: Software and Cloud, Hardware Systems and Services. The Software and Cloud business operates through the following segments: New Software Licenses and Cloud... More
Sector: Technology
Industry: Application Software
Country: United States