Software Strength Carries Oracle to EPS Beat

By FOXBusiness

In an early glimpse into tech earnings, tech giant Oracle (NASDAQ: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.

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%.