Oracle profits beat expectations, but stocks slide as investors take profits – –

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Oracle profits beat expectations, but stocks slide as investors take profits – –


Oracle
posted better-than-expected results for its fiscal fourth quarter ended May 31, as the enterprise software company saw the strength of its enterprise application portfolio and continued triple-digit growth for its business in cloud infrastructure.

But the stock is trading slightly lower after hours as some investors are taking profits after stocks have risen nearly 30% since mid-March. Weaker-than-expected forecasts for the August quarter are also putting pressure on the action. Oracle shares (ticker: ORCL) at the end of the session fell 4.8% to $ 77.74.

For the quarter, Oracle posted revenue of $ 11.2 billion, up 8% or 4% at constant exchange rates, the company’s best quarterly growth rate in a decade. The top row was ahead of the company’s forecast range, which predicted growth of 5% to 7%, or 1% to 3% in constant currency.

Non-GAAP earnings were $ 4.5 billion, or $ 1.54 per share, also ahead of the expected range of $ 1.28 to $ 1.32 per share. Based on GAAP, the company earned $ 4 billion, or $ 1.37 per share. Cash flow from operations was $ 15.9 billion, up 21%.

Oracle has demonstrated strength in its application portfolio, with revenue growth of 46% for Fusion ERP (financial software for large enterprises), growth of 35% for Fusion HCM (HR software for large enterprises) and 26% growth for NetSuite ERP (financial software for small businesses) to midsize businesses). The company said its cloud infrastructure business, including Oracle Cloud and Autonomous Database software, has grown by more than 100%.

For the full year, revenue was $ 40.5 billion, up 4% or 2% at constant exchange rates. Profits for the year were $ 14.1 billion, or $ 4.67 per share; Based on GAAP, the company earned $ 13.7 billion, or $ 4.55 per share.

“Our performance in the fourth quarter was absolutely exceptional,” Oracle CEO Safra Catz said in a statement. “Our multi-billion dollar cloud application companies Fusion and NetSuite have seen dramatic increases in their already rapid revenue growth rates. “

In a conference call with investors this afternoon, Catz said the company forecasts revenue growth for fiscal 2022 faster than the 2021 level, with constant single-digit currency growth. She also said the company plans to invest in the business at a higher rate to “further accelerate sales.”

Catz says Oracle sees its cloud business as “fundamentally more profitable than on-premises software.” She said the company expects to nearly double cloud investment spending in fiscal 2022 to nearly $ 4 billion. The additional spending, she said, will be more than justified by increased margins and increased growth.

For the August quarter, Oracle forecasts revenue growth of 3-5%, or 1-3% at constant exchange rates. She said non-GAAP earnings are expected to range from 94 cents to 98 cents per share, slightly below Street’s consensus of $ 1.03 per share, with GAAP earnings ranging from 91 to 95 cents.

Catz also said Oracle repurchased $ 8 billion of common stock during the quarter, bringing the total for the past four quarters to $ 21 billion.

Write to Eric J. Savitz at [email protected]

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