Oracle Quarterly, Yearly Numbers Flat but Beat Street Anyway

Oracle’s earnings reports have been carbon copies of each other for the last several quarters. The commonalities all involve “revenue flat or slightly lower,” “improving cloud service sales” and “eroding hardware sales.”

The story was no different June 16, when the database and enterprise software maker beat Wall Street estimates by posting revenue of $10.6 billion (down 1 percent year over year) and flat profits amounting to $2.81 billion for Q4 2016. The total revenue number beat the $10.47 billion expected by Wall Street analysts.

As for fiscal 2016 itself, Oracle’s total revenues also were flat at $37.0 billion, down 3 percent in U.S. dollars and up 2 percent in constant currency. Fiscal 2016 profit also was flat at $8.9 billion; earnings per share for the year was $2.07.

Total software revenues were $29.0 billion for the fiscal year, down 2 percent in U.S. dollars.

The company’s best news, as it has been for a while, was in the cloud sales revenue category, which was up 68 percent to $859 million in fiscal Q4. Add in Oracle’s on-premises quarterly software revenues, and you get $8.4 billion for all software, flat in U.S. dollars and up 2 percent in constant currency.

Total hardware revenue for FY 2016 was $1.28 billion, down 9 percent from $1.4 billion the previous year.

So it was generally a flat fiscal quarter and year for Oracle, which has been nagged by lessening hardware sales of servers and other data center equipment since it bought Sun Microsystems in 2010.

The stock price rose a slight bit after the news was released (0.5 percent)—one could say that, too, was flat—in extended trading at 4 p.m. Pacific to $38.64.

Oracle added about 1,600 new software-as-a-service (SaaS) customers and more than 2,000 new platform-as-a-service (PaaS) customers in the quarter, Oracle CEO Mark Hurd said.

Chairman and CTO Larry Ellison announced on the conference call an ambitious goal for the next few years: for Oracle to become the first cloud company to reach $10 billion in SaaS and PaaS revenue.

“We expect that the SaaS and PaaS hypergrowth we experienced in FY16 will continue on for the next few years,” Ellison said.