Oracle Earnings: Here’s Why Investors are Not Happy Now

Oracle Corp. (NASDAQ:ORCL) delivered a profit and met Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 8.31%.

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Oracle Corp. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 6.1% to $0.87 in the quarter versus EPS of $0.82 in the year-earlier quarter.

Revenue: Rose 0.41% to $10.96 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Oracle Corp. reported adjusted EPS income of $0.87 per share. By that measure, the company met the mean analyst estimate of $0.87. It missed the average revenue estimate of $11.12 billion.

Quoting Management: “Exadata, Exalogic, Exalytics, SPARC SuperCluster and our other engineered systems grew at a rate of 45% in Q4 as we took considerable market share from our primary competitor – IBM P-Series – which declined 32% in their most recent quarter,” said Oracle CEO, Larry Ellison. “We sold over 1,200 engineered systems in the quarter and over 3,000 during the year. Our fast growing engineered systems business is now more than one-third of our overall hardware business which is one of the reasons we believe hardware will be a growth story in Oracle’s FY14.”

Key Stats (on next page)…

Revenue increased 22.36% from $8.96 billion in the previous quarter. EPS increased 33.85% from $0.65 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a profit of $0.58 and has not changed. For the current year, the average estimate has moved down from a profit of $2.69 to a profit of $2.68 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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