Oracle recently reported its quarterly earnings, surpassing Wall Street’s expectations and resulting in a 13% increase in shares during extended trading. The company’s performance in the fiscal third quarter ending February 29 outperformed estimates by LSEG. Oracle reported adjusted earnings per share of $1.41, compared to the expected $1.38. Additionally, the company’s revenue reached $13.28 billion, slightly exceeding the $13.3 billion expected figure.
Looking ahead to the fiscal fourth quarter, Oracle anticipates earnings of $1.62 to $1.66 per share. This projection slightly missed analysts’ expectations of $1.64 in adjusted earnings per share, according to LSEG. The company also forecasts a revenue growth rate of 4% to 6%, compared to the $13.8 billion in sales recorded a year ago. With the midpoint of this range translating to revenue of approximately $14.5 billion, analysts had higher expectations at just over $14.7 billion.
Oracle’s CEO Safra Catz expressed the company’s commitment to achieving the previously stated goal of $65 billion in sales by fiscal 2026. Catz mentioned that some of the goals set might prove to be too conservative given their current momentum. On the financial front, revenue saw a 7% increase from $12.4 billion the previous year, while net income surged by 27% to $2.4 billion, or 85 cents per share.
Oracle’s cloud services and license support segment, the largest business division, saw a significant 12% growth in sales to $9.96 billion. This performance slightly outperformed the StreetAccount consensus of $9.94 billion, driven by strong demand for the company’s artificial intelligence servers. The cloud revenue, included in the cloud services unit, witnessed a substantial 25% year-over-year increase to $5.1 billion.
Despite the positive outcomes in certain segments, Oracle faced challenges in its other units. Cloud license and on-premise sales experienced a 3% decline to $1.26 billion, slightly beating StreetAccount’s forecast. Hardware revenue also dropped by 7% to $754 million, with sales in the services division decreasing by 5% to $1.31 billion, falling short of expectations.
Oracle’s recent quarterly earnings report highlights the company’s overall positive performance, particularly in its cloud services and license support segment. With strong financial figures reported and a promising outlook for the fiscal fourth quarter, Oracle seems to be on track to achieve its long-term sales goals. By addressing challenges in certain business units, the company can continue to drive growth and innovation in the competitive tech industry.
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