Oracle soars in software, but hardware sales lag

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Oracle soars in software, but hardware sales lag

In a surprise move, Oracle has announced its fiscal 2012 fourth-quarter and full-year financial results three days early, amid reports the IT giant is planning a corporate reorganisation.

The company declined to address why the earnings announcement was moved up, or reports North America sales executive Keith Block is being dismissed from the company.

CEO Larry Ellison, co-presidents Mark Hurd and CFO Safra Catz painted a generally upbeat portrait of the company.

"Obviously, we couldn't be happier with our Q4 results," Catz said in a call with analysts.

For the fourth quarter ended May 31, Oracle reported net income at $US3.5 billion, up 8 percent from $US3.2 billion last year. Total software revenue for the quarter was up 6 percent to $8.1 billion.

"We sold $US4 billion in software for the first time ever," Ellison said on the call. "This growth comes off double-digit comparisons over the last two years."

The company also recorded solid sales growth in application, database and middleware software, as well as applications for vertical industries such as healthcare, retail and financial services.

Conversely, total hardware systems revenue dropped 14 percent in the quarter to $US1.6 billion.

The Oracle executives noted that hardware revenue exceeded earlier guidance, and Hurd said sales of "engineered systems" -- Oracle's term for its Exadata, Exalogic, Exalytics, SPARC SuperCluster and Oracle Big Data Appliance servers -- doubled year-over-year in the fourth quarter.

Expectations for the current fiscal year remain high, as Ellison repeated a pledge he made on Oracle's third-quarter earnings call that the company's hardware business will turn profitable in fiscal 2013.

For all of fiscal 2012 ended May 31, Oracle reported net income of $US10 billion, up 17 percent from $US8.5 billion in fiscal 2011.

Software and hardware sales in the fiscal year echoed that of the fourth quarter, with total software revenue up 9 percent to $US26.1 billion, and hardware systems revenue for the year dropping 9 percent to $6.3 billion.

This article originally appeared at crn.com

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