Oracle Corp reported quarterly revenue that topped analysts’ estimates and projected rising sales, in a sign of greater demand for its cloud-computing services while businesses are working remotely during the COVID-19 pandemic.
Fiscal first-quarter sales rose 1.6 percent to US$9.37 billion, the US-based company said in a statement on Thursday. Analysts, on average, estimated US$9.19 billion, according to data compiled by Bloomberg.
The company’s revenue had declined 6 percent year-on-year in the previous three-month period.
Oracle CEO Safra Catz projected a revenue climb in the third quarter of between 1 and 3 percent from a year earlier. Analysts anticipated no sales growth.
Catz and Oracle executive chairman Larry Ellison have tried to revamp the company’s business model for a new era of computing, in which software is delivered through the Internet rather than shipped in boxes on discs.
The quarterly results show that Oracle’s cloud-based business applications lead the way on modernizing the business, even as demand withers for the company’s older technology.
The pair’s latest bet is to try to acquire the US assets of video-sharing platform TikTok, owned by China’s ByteDance Ltd (字節跳動).
While the two companies occupy very different parts of the technology market, the deal could give the world’s second-biggest software maker another anchor tenant for its public cloud services that rival Amazon.com Inc and Microsoft Corp, as well as provide a huge amount of consumer data Oracle could sell to advertisers for its ad-targeting business, Oracle Data Cloud.
After years of largely going it alone, Oracle has signed more partnerships with other software makers in an effort to make its cloud services more appealing and useful to corporate customers.
While it has lost a bid to supply cloud services to the US Department of Defense, the company’s partnership with Microsoft, which is also in the running to buy TikTok, means that it could one day supply cloud software to the Pentagon.
The 43-year-old software maker has also made its cloud technology work inside of customers’ own server farms, for firms that are unwilling or unable to outsource computing needs. Catz described the company’s results as “fantastic.”
“I have a high level of confidence that our revenue will accelerate as we move on past COVID-19,” she said in the statement.
Profit, excluding some expenses, would be US$0.98 to US$1.02 per share in the quarter that ends in November, compared with analysts’ average estimate of US$0.94.
The company recorded a profit of US$0.93 per share in the quarter that concluded at the end of last month, while analysts were looking for US$0.86.
Shares gained more than 3 percent in extended trading after the results. Earlier, the stock closed at US$57.33 in New York, and has jumped 8.2 percent this year.
Revenue from cloud services and license support climbed 2 percent to US$6.95 billion. That metric includes sales from hosting customers’ data in the cloud, but a large portion is generated by maintenance fees for traditional software housed on clients’ corporate servers.
Cloud license and on-premise license sales increased 9 percent to US$886 million, suggesting the company is signing more new software deals. Revenue from the company’s accounting and financial-planning application for large businesses climbed 33 percent last quarter, while sales of NetSuite, which caters more to small and mid-sized businesses, rose 23 percent.
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