Oracle Corp’s net income jumped 25 percent in the most recent quarter as CEO Larry Ellison trumpeted momentum in the company’s efforts to sell computer hardware and in its showdown with IBM Corp.
The results, reported on Thursday after the market closed, were helped by stronger sales of database and other business software and a bump from its acquisition of Sun Microsystems.
Oracle’s numbers are important for what they say about companies’ appetite for new technologies. Oracle’s sales of new software licenses rose 14 percent to US$3.1 billion, the third straight quarter of increases and a sign of sustained demand.
The quarter was also significant because it marked a turning point: It was Oracle’s first full quarter with Sun Microsystems under its belt, which means Wall Street can look at Oracle’s numbers and examine its progress in squeezing profits from Sun, an innovative company that was nearly sunk by its big expenses.
Oracle’s net income was US$2.4 billion, or US$0.46 per share, in its fiscal fourth quarter, which ended May 31. That compares with US$1.9 billion, or US$0.38 per share, a year earlier.
Excluding items, Oracle’s profit would have been US$0.60 per share, better than the US$0.54 per share Wall Street expected on that same basis.
Revenue jumped 39 percent to US$9.5 billion, from US$6.9 billion, matching the average forecast of analysts polled by Thomson Reuters.
The story underlying Oracle’s numbers is the company’s push into making computing hardware, a radical transformation for the world’s No. 1 database maker and a top supplier of other types of business software.
Oracle paid US$7.4 billion for Sun in a bid to build servers and software that work better together — and mount a bigger challenge to IBM.
Ellison said in prepared remarks that the new Sun Exadata “database machine” was helping Oracle win over IBM customers, as “some of IBM’s largest customers began buying Exadata machines rather than big IBM servers” in the latest period.
IBM declined to comment.
Ginning up momentum in Sun’s hardware business is key for Oracle, since Sun’s server market share has experienced severe declines amid uncertainty over Oracle’s plans for the business.
For Oracle’s full fiscal year, its net income rose 10 percent to US$6.1 billion, or US$1.21 per share, on revenue that rose 15 percent to US$26.8 billion.
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