Oracle topped analyst expectations and continued its push into the cloud computing space with another strong quarter.
Execs, talking to analysts on Thursday, were optimistic in the database and middleware titan's ability to continue to move from its massive on-prem empire to more cloud and service offerings. Just don't talk about hardware.
For the fiscal 2018 Q2 [PDF], ended November 30, Hurd n' Katz today reported:
- Revenues of $9.6bn were up 6 per cent from the year-ago quarter and ahead of the $9.57bn analysts had forecast.
- Operating income of $3.1bn was up 1 per cent year over year.
- Earnings per share of 70 cents were above analyst estimates of 62 cents.
- Cloud revenues were $1.5bn, up 44 per cent year over year. Despite the biz's heavy emphasis on cloud, the unit accounts for just around 16 per cent of Oracle's total revenue.
- Software updates and product support are still the big earner for the House of Larry. The $4.95bn booked was more than half of all revenues, and up 4 per cent year over year.
- New software licenses brought Oracle $1.35bn over the quarter, flat from the same period last year.
- Hardware continued to circle the drain, as revenues of $940m were a seven per cent drop from Q2 2017.
- Services revenues were $856m, up 1 per cent year over year.
"Our success in the quarter was based on the increasing scale and the gathering momentum in our cloud business," co-CEO Safra Katz said. "I expect the business to continue to grow and strengthen over the coming quarters.”
Co-CEO Mark Hurd also talked up Oracle's cloud prospects, noting that the biz still has one very large and mostly untapped market: its on-prem customer based.
"Most of what is in our revenue base did not come from our on-prem user base," Hurd said. "We are hopeful we will start to see a higher percentage of Oracle's user base moving."
Despite the big talk on cloud, however, shares in Oracle were down 6.5 per cent (at $46.88 apiece) in after-hours trading as analysts expected higher cloud returns. ®