Oracle Corp, the second-largest independent software maker, said it may have seen the worst of a sales slump that contributed to a 7.7 percent decline in fiscal fourth-quarter earnings.
The shares rose some 8.8 percent Monday in after-hours trading after Chief Financial Officer Jeff Henley gave positive comments on Oracle's sales outlook since the company surprised investors with a third-quarter earnings shortfall.
Software sales fell 10 percent to US$1.66 billion in the quarter ended May 31 as businesses cut computer-related spending.
Henley said he expects first-quarter software sales to be little changed from last year's US$807 million, but hinted a rise in sales may be in the cards.
``Things fell off a cliff last quarter -- this quarter they were able to adjust,'' said Jon Ekoniak, an analyst at US Bancorp Piper Jaffray, who has a ``neutral'' rating on Oracle.
Oracle has been hit by the slowdown that's led to less demand for everything from cellular telephones to computer memory chips, affecting sales at companies such as No. 1 chipmaker Intel Corp and Dell Computer Corp, the biggest US PC maker.
The NASDAQ Composite Index has lost about 20 percent of its value since the beginning of the year.
The shares of Oracle rose as high as US$16.15 after Monday's release. The stock fell US$0.16 to US$14.84 in regular trading before the report. The shares have fallen 68 percent from a September high.
The shares of Oracle Corp Japan, the Japanese unit of the No. 1 database software maker, surged as much as 7.6 percent. The shares slipped in the afternoon, finishing the day up 3.0 percent.
Fourth-quarter net income fell to US$855 million, or US$0.15 a share, with profits from operations of US$926 million, or US$0.15, a year earlier. That beat the US$0.14 average analyst estimate in a poll by First Call/Thomson Financial. Revenue dropped 3.3 percent to US$3.26 billion from US$3.37 billion.
``There are certainly no guarantees and there are risks. But we are cautiously optimistic that things will swing upward,'' Henley said. ``It feels to us like in Q4 we hit the bottom.'' He said he expects first-quarter profit to meet the US$0.08 average estimate of analysts polled by First Call. Fiscal 2002 earnings will probably be US$0.50 a share, meeting the First Call estimate, he said.
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