Oracle's shopping spree to continue

27-06-2007

by Ciara O'Brien

Oracle's revenue and profit jumped in the fourth quarter, with revenue rising 20 percent and net income up by 23 percent.

The software giant's revenue came to USD5.8 billion, exceeding analysts' expectations of USD5.61 billion. Net income was USD1.6 billion, with GAAP earnings per share coming to USD0.31, up 27 percent compared with a year earlier.

Software revenues grew to USD4.8 billion, a rise of 19 percent, while new license revenues rose 17 percent. GAAP database and middleware new license revenues increased 18 percent and GAAP applications new license revenues were up 13 percent. GAAP services revenues soared 26 percent to USD1.1 billion.

"If you have the right strategy and the best technology it will show up in your results," said Safra Catz, Oracle's president and CFO. "The numbers speak for themselves."

Meanwhile, yearly earnings for fiscal 2007 showed GAAP earnings per share increased 27 percent to USD0.81, while revenues were up 25 percent to USD18 billion. Net income for the period showed a 26 percent rise, reaching USD4.3 billion.

Total GAAP software revenues for the year increased by 23 percent, reaching USD14.2 billion. Database and middleware new license revenues showed growth of 16 percent, while applications new license revenues surged by 32 percent. Annual GAAP services revenues reached USD3.8 billion, a 33 percent rise compared to the same period a year ago.

It seems that the firm's recent shopping spree is paying off, and according to chief executive Larry Ellison, the acquisitions are set to continue.

In the past few years Oracle has bought about 30 different firms, including Hyperion Solutions, at a total cost of about USD25 billion. In an earnings call, Ellison said the pace of acquisition was likely to continue, as the firm increased its market share at the expense of its rivals.

"Oracle's unique database grid architecture has enabled us to take market share from IBM," said Ellison in a statement. "Gartner's just-published database research report confirms that Oracle's database market share has now increased to 47 percent while IBM's share declined to 21 percent."

Oracle is also aiming to eclipse rival SAP, with its applications new software license revenues growing at a rate of 32 percent, compared to SAP's growth rate of 10 percent in its most recent fiscal year, according to Oracle president Charles Phillips.