Oracle Q2 Earnings Mixed, co-CEO Joins Trump Transition Team

Safra Catz will remain on the job at Oracle while performing unspecified tasks for the Trump transition team.

Now that Oracle has one of its highest-ranking executives doing duty as a member of President-elect Donald Trump's transition team, one wonders how a job like that might eventually benefit her employer.

Oracle reported its Q2 financial results Dec. 15 immediately following a highly publicized meetup the day before in New York between Trump and a number of high-ranking Sillicon Valley executives, including Oracle co-CEO Safra Katz, Apple CEO Tim Cook, Amazon CEO Jeff Bezos, Alphabet Chairman Eric Schmidt and several others.

Catz (pictured) was officially added to Trump's transition team following the meeting. Catz will remain at Oracle while performing unspecified tasks for the team.

On the finance side, the world's largest database company on Dec. 15 reported a mixed set of numbers for its Q2 quarterly earnings that included slightly better profits than Wall Street analysts projected. But its revenue was flat and came in short of estimates.

Oracle, which is pivoting its business to cloud services, posted revenue of $9.07 billion, which was a slight improvement on sales of $9 billion a year ago, but for all intents and purposes at the same level as 2015. Net income was $2 billion, also flat against 2015 totals.

While the company's traditional server-based enterprise software and hardware businesses continue to decline, its software and cloud revenue has improved each quarter for a few years. Oracle's Q2 software and cloud revenue totaled $7.2 billion, below the $7.31 billion projection by a consensus of analysts; total quarterly cloud revenue hit $1.1 billion, the first quarter that it has sold more than $1 billion in that category.

On a call with analysts, Oracle co-CEO Mark Hurd said the company's next quarter "has a chance to be its best quarter ever, period."

Catz told investors on the same call that since Trump campaigned on lowering the U.S. corporate tax rate, there was a better likelihood of favorable tax results for Oracle.

Cloud-based software and service sales continue to overtake Oracle's old software and hardware businesses, Catz said.

"Our cloud revenue will be larger than our new software licenses revenue next fiscal year, when the transition will be largely complete," Catz said.

Hurd claimed Oracle has passed to become the No. 1 provider of software-as-a-service cloud applications sales to companies with more than 1,000 employees.

"With the acquisition of NetSuite, we plan on being the No. 1 cloud applications service provider for companies with less than 1,000 employees as well," Hurd said.

Chris Preimesberger

Chris J. Preimesberger

Chris J. Preimesberger is Editor-in-Chief of eWEEK and responsible for all the publication's coverage. In his 15 years and more than 4,000 articles at eWEEK, he has distinguished himself in reporting...