Oracle (ORCL) Beats Earnings and Brings a Fresh Take with Hurd

Oracle tapped profits from higher-than-expected sales from software licenses and servers to beat Q1 2011 estimates in its earnings report today.

The company reported earnings of $0.42 (non-GAAP) per share on 50 percent higher revenues, beating consensus estimates of $0.37 for the quarter. GAAP EPS came in at $0.27 and GAAP revenues rose 48 percent.

The company made the news recently when it hired former HP chief Mark Hurd to head Oracle.  In a press release, President Hurd pointed to new high-end server products that integrate Solaris servers with Oracle software: “We will invest over $4 billion in research and development this year, so our already robust product portfolio is only going to get stronger.”

The company also announced a cash dividend of $0.05 per share of outstanding common stock. The stock rose over 4 percent in after hours trading.

Oracle, the global leader in enterprise software, acquired Sun Microsystems last April among other recent large acquisitions.


The company is executing well following its acquisition of Sun and is well-capitalized to expand its operations and product offerings. Hardware sales first hit financial statements in Q3 for fiscal year 2010, so these offerings should contribute more to next year’s bottom line. Still, revenues for software sales this quarter fell below the sales numbers for the previous two quarters. Given the recent string of acquisitions, it’s hard to find the real growth story at Oracle, but recent insider sales during the top-performing Q4 in 2010 suggested the stock was not likely to break out of its $20 to $26 trading range. But then came Mark Hurd and the stock got fresh and shiny again and the stock popped up on the news. The stock is in a strong uptrend and the fresh enthusiasm for ORCL is not likely to subside for some time to come.

Disclosure: Owns Oracle