Software Strength Carries Oracle to EPS Beat

By Matt Egan Features FOXBusiness


In an early glimpse into tech earnings, tech giant Oracle (ORCL) beat the Street late Tuesday with an 18% jump in fiscal second-quarter profits amid strength in its software business.

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Shares of the technology behemoth climbed almost 2% after-hours action, building on a solid gain during regular trading.

Oracle said it earned $2.58 billion, or 53 cents a share, last quarter, compared with a profit of $2.19 billion, or 43 cents a share, a year earlier.

Excluding one-time items, the company earned 64 cents a share, trumping the Street’s view of 61 cents.

Total revenue grew 3% to $9.1 billion, compared with consensus calls from analysts for $9.02 billion.

Redwood City, Calif.-based Oracle is the first large technology company to report quarterly results, giving investors an early look at how the industry fared ahead of the fiscal cliff.

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Second-quarter performance was "strong and broad based as all geographies reported double-digit revenue growth in new software license and cloud subscriptions,” Oracle President Mark Hurd said in a statement.

Oracle said its software license updates and product support revenue grew 7% to $4.3 billion, while new software licenses and cloud software subscription revenue soared 17% to $2.4 billion. Overall, software revenue rose 10% to $6.65 billion.

On the other hand, hardware systems revenue dropped 16% to $1.32 billion, hurt by a 23% tumble in hardware systems products sales. Hardware support revenue declined by a more modest 6% to $587 million.

Oracle’s shares rose 1.49% to $33.35 in after-hours action, putting them on pace to build on a year that has seen them rally 28%.