{"id":60048,"date":"2023-09-12T11:38:25","date_gmt":"2023-09-12T15:38:25","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/oracle-stock-falls-after-earnings-report\/"},"modified":"2023-09-12T11:38:28","modified_gmt":"2023-09-12T15:38:28","slug":"oracle-stock-falls-after-earnings-report","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=60048","title":{"rendered":"Oracle Stock Falls After Earnings Report"},"content":{"rendered":"
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\n Oracle
\n shares were heading lower after the enterprise software giant posted earnings and guidance that fell short of investor expectations.<\/p>\n

The stock slipped 5% after the report and ahead of the company\u2019s post-earnings call with investors, and then fell further after the company provided November quarter guidance, broadening the loss to more than 8%. In premarket trading Tuesday, shares were down nearly 10%. <\/p>\n

\n

For the fiscal first quarter ended Aug. 31, Oracle (ticker: ORCL) reported revenue of $12.45 billion, about in line with consensus, up 9% from a year ago, and 8% higher adjusted for currency. The company\u2019s guidance for the quarter had called for 8% to 10% growth in constant currency. Adjusted profits were $1.19 a share, four cents above the Wall Street consensus at $1.15 a share, and above the guidance range of $1.12 to $1.16 a share. Under generally accepted accounting principles, Oracle earned 86 cents a share in the quarter.<\/p>\n

Oracle said cloud revenue was $4.6 billion, up 30% from a year ago; that includes 17% growth in cloud application revenue to $3.1. billion, and 66% growth in cloud infrastructure revenue, to $1.5 billion. <\/p>\n

The company said Fusion Cloud ERP, the company\u2019s enterprise software for larger enterprises, was up 21% to $800 million, while NetSuite Cloud ERP, similar software for smaller companies, was up 21% to $700 million.<\/p>\n

\u201cIs Generative AI the most important new computer technology ever? Maybe!,\u201d Oracle Chairman and CTO Larry Ellison said in the earnings statement. \u201cSelf-driving cars, molecular drug design, voice user interfaces\u2014billions of dollars are being invested in AI. As of today, AI development companies have signed contracts to purchase more than $4 billion of capacity in Oracle\u2019s Gen2 Cloud. That\u2019s twice as much as we had booked at the end of Q4.\u201d<\/p>\n

Ellison asserted that Oracle can train AI models at twice the speed and less than half the cost of other clouds.<\/p>\n

Oracle stock has rallied more than 50% this year on growing expectations that its Oracle Cloud Infrastructure business will get a boost from generative AI workloads. It has outperformed
\n Microsoft
\n (MSFT), widely considered one of the most important AI software players, by 10 percentage points.<\/p>\n

For the November quarter, Oracle sees revenue up 5% to 7%, or 3% to 5% in constant currency. Excluding the company\u2019s recently acquired Cerner healthcare software business, Oracle sees growth of 8% to 10%, or 6% to 8% adjusted for currency. <\/p>\n

Total cloud revenue excluding Cerner is expected to grow 29% to 31%, or 27% to 29% in constant currency. Oracle sees profits for the quarter of between $1.30 and $1.34 a share. Street consensus estimates had called for revenue of $13.3 billion, up 8%, with profits on an adjusted basis of $1.34 a share.<\/p>\n

On the call, Oracle CEO Safra Catz said the company remains committed to its previous FY 2026 financial target of at least $65 billion in revenue.<\/p>\n

On the company\u2019s last earnings call, Catz said her early read on Oracle\u2019s May 2024 fiscal year was for unprecedented cloud demand, with growth on par or better than fiscal 2023.<\/p>\n

Oracle continues to move its legacy customers to cloud-based versions of its flagship database software and its suite of enterprise applications, including NetSuite and Fusion. <\/p>\n

But the Oracle story is driven by the Oracle Cloud\u2014known as OCI\u2014and the outlook for the company\u2019s role in AI. Among other things, it has benefited from a strong relationship with
\n Nvidia
\n (NVDA), which has given Oracle a generous allocation of GPU chips that it uses to offer AI computing services to customers.<\/p>\n

Oracle will hold a meeting with analysts next week in connection with its annual Oracle Cloud World user conference. The company has also announced a joint press conference with Microsoft this Thursday that will feature both Ellison and Microsoft CEO Satya Nadella, and which will focus on their work together on cloud computing applications.<\/p>\n

Write to Eric J. Savitz at eric.savitz@barrons.com<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Oracle shares were heading lower after the enterprise software giant posted earnings and guidance that fell short of investor expectations. The stock slipped 5% after the report and ahead of the company\u2019s post-earnings call with investors, and then fell further after the company provided November quarter guidance, broadening the loss to more than 8%. In […]<\/p>\n","protected":false},"author":1,"featured_media":60049,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-60048","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-investing","tag-featured","post_format-post-format-video"],"yoast_head":"\nOracle Stock Falls After Earnings Report | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Oracle shares were heading lower after the enterprise software giant posted earnings and guidance that fell short of investor expectations. 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