Oracle ends fiscal 2014 on a sour note as Q4 swings to a miss

Oracle ends fiscal 2014 on a sour note as Q4 swings to a miss

Summary: As a result, Oracle shares started to tumble by as much as 8.4 percent in after-hours trading, according to MarketWatch.

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Oracle turned in its final earnings report for the 2014 fiscal year on Thursday after the bell, and the results were less than expected.

The hardware and software giant ended up with a Q4 net income of $3.6 billion, or 80 cents per share (statement).

Non-GAAP earnings were 92 cents per share on a revenue of $11.3 billion, up three percent annually.

Wall Street was looking for earnings of 95 cents per share on a revenue of $11.48 billion.

The Redwood Shores, Calif.-headquartered corporation attributed part of the problem to "a non-operating loss caused by exchange rate changes in Venezuela," adding that this caused GAAP and non-GAAP earnings per share to be reduced by two cents a pop.

As a result, Oracle shares started to tumble by as much as 8.4 percent in after-hours trading, according to MarketWatch.

Revenue was still up when broken down by department as well. Software and cloud services revenue totalled approximately $8.9 billion for the quarter, up four percent year-over-year.

Oracle president and chief financial officer Safra Catz highlighted the cloud department, citing that particular subscription business is on track to a run rate of roughly $2 billion per year.

Also focusing on the cloud while touting Oracle as "the second largest SaaS company in the world," CEO Larry Ellison reflected on the Software-as-a-Service market in prepared remarks:

In SaaS, we’re in front of everybody but salesforce.com. In IaaS we’re larger and more profitable than Rackspace. We have by far the most complete portfolio of modern SaaS and PaaS products in the industry: CRM: Sales, Service & Marketing; HCM: HR, Payroll & Talent; ERP: Accounting, Procurement, Supply Chain & more. All these SaaS products run on the world’s most powerful PaaS: the Oracle in-memory multitenant database and Java. We plan to increase our focus on the Cloud and become number one in both the SaaS and the PaaS businesses.

SaaS and PaaS subscriptions jumped by 25 percent $322 million during the fourth quarter, while IaaS subscription increased by 13 percent to $128 million.

Oracle president Mark Hurd chimed in with a hardware note, boasting that Oracle has "transformed Sun’s commodity hardware business into a profitable and growing Engineered Systems business."

Hurd projected that Oracle expects to ship its 10,000th unit of Engineered Systems during the current quarter.

For fiscal year 2014, Oracle delivered revenue of $38.3 billion, also up three percent annually.

For the first quarter of fiscal 2015, Wall Street expects Oracle to deliver earnings of 64 cents per share on a revenue of $8.78 billion.

Topics: Enterprise 2.0, Cloud, Enterprise Software, Hardware, Oracle

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6 comments
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  • Misleading article title

    To the author, why did you say that Oracle suffered a loss, when it earned $3.6B? I gather that you don't like Oracle, but at that the most, you can brag that the company missed market expectations. Your title is very misleading.
    P. Douglas
    • Was it changed?

      Was it changed because it doesn't say loss. It says a miss which is just a miss of the estimates the were setting the current stock price. Tech stocks do bring about or irrational investors (like the ridiculous TSLA at an order of magnitude above any rational price) but missing estimates do call for an adjustment simply because people were buying based on the estimates.
      Buster Friendly
      • Oracle takes a loss

        The email introducing the posting mentioned loss. Very misleading - the web site might have been updated after the emails were out. Poor journalism. I was interested in how Oracle made a loss, missing targets is something completely different and much more trivial
        riwide
  • compared figures

    Oracle expects to ship its 10,000th unit of Engineered Systems during the current quarter...compared with Hewlett Packard that sells near 200.000 servers in the world for trimester, the oracle figure seems very little.
    luis river
    • Different type of company

      They're a different type of company compared to HP. Oracle makes its money off the software and support. Even if you buy their hardware, you'll spend many times more on the software than you will on the hardware.
      Buster Friendly
  • Non-GAAP earnings were 92 cents per share on a revenue of $11.3 billion, up

    I'm am sure in more than one case the analyst has some interest in the shares going up or down, and so it says something or the contrary...
    A company with a revenue of $11.3 billion is a big success, no matter what an asshole analyst says.
    aviamquepasa