Oracle's Earnings Beat Expectations Despite Slump

The Redwood Shores-based company earned $534.9 million, or 10 cents per share, for the three months ended Nov. 30, a 3 percent decrease from the $549.5 million, or 10 cents per share, earned at the same time last year.

The results topped the consensus estimate of 8 cents per share among analysts polled by Thomson First Call.

The company disclosed the results after the stock market closed Wednesday. Oracle's shares fell 39 cents to close at $10.63 on the Nasdaq Stock Market, then gained back 33 cents in extended trading.

Oracle's revenue in the revenue totaled $2.31 billion, a 3 percent decline from $2.38 billion in last year's comparable period. It marked the seventh consecutive quarter that Oracle's revenue had fallen off from the previous year.

id
unit-1659132512259
type
Sponsored post

With the erosion becoming less severe, Oracle is optimistic about the company's chances of reviving sales growth during the current quarter ending in February, said chief financial officer Jeff Henley.

"We feel things are starting to bottom out and we think there will be a modest improvement for the economy and technology spending," Henley told reporters in a conference call. "We think the worst is over."

The remarks echo the sentiments of many other Silicon Valley executives who believe the high-tech sector is about to slowly climb out of the sales crater created by the dot-com implosion of two years ago.

Oracle's prolonged slump has cut so deeply into the company's sales that it will be easier to improve on the prior year's results.

The company made some strides in its latest quarter.

Although the company's overall sales of new software licenses fell by 7 percent to $764.9 million in the quarter, the performance in its main database business rose slightly. The company's revenue from new database licenses and updates $1.15 billion, a 4 percent increase from $1.11 billion last year.

But Oracle's sales of software for running business applications continued to fall. Oracle registered application sales of $251.7 million, a 14 percent decrease from $291.2 million last year.

With its sales still weak, Oracle trimmed its work force to help boost its earnings. The company eliminated 851 jobs, or about 2 percent of its work force, between August and November to lower its payroll to 40,645 employees.

Most of the job cuts affected Oracle's consulting services, Henley said.

For the first half of its current fiscal year, Oracle earned $877.6 million, or 16 cents, per share on revenue of $4.3 billion. At the same juncture last year, Oracle had earned $1.06 billion, or 18 cents per share, on revenue of $4.6 billion.

Copyright © 2002 The Associated Press. All rights reserved. The information contained in the AP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of The Associated Press.