Oracle Corp on Friday reported its profit surged 28 percent in its first fiscal quarter, matching Wall Street expectations despite a sluggish increase in sales.
The business software maker from Redwood Shores, California, earned US$440 million, or US$0.08 per share, for the three months ending Aug. 31, up from US$343 million, or US$0.06 per share, a year ago.
Oracle's revenue totaled US$2.07 billion, a 2 percent increase from US$2.03 billion last year.
The earnings and revenue were both in line with the consensus estimates among analysts surveyed by Thomson First Call.
But Oracle's results sagged in one of the key measures of a software maker's health -- licensing sales.
Such sales totaled US$515 million in the quarter, a 6 percent drop from the same time last year. Much of the erosion occurred in North America, company executives told analysts during a conference call Friday.
If not for international gains from the weak dollar, Oracle's first-quarter license sales would have declined by 10 percent.
The downturn came in a summer quarter that traditionally is Oracle's weakest.
The performance nevertheless disappointed investors. Oracle's shares fell US$0.43 to close at US$12.55 on the NASDAQ Stock Market.
Management assured analysts that business will pick up later in the fiscal year.
"We believe everything is in place for a better year," said Jeff Henley, Oracle's chief financial officer, said during the conference call.
Henley projected earnings of US$0.10 or US$0.11 per share in the current quarter that ends in November.
The consensus estimate among tech sector analysts is US$0.11 per share, according to Thomson First Call.
Oracle also reiterated its intent to pursue its US$7.5 billion hostile takeover bid for rival software maker PeopleSoft Inc.
The US$19.50-per-share offer is in a holding pattern until late October or early November when Oracle expects the US Department of Justice to complete an antitrust review of the proposed deal.
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