Oracle bucks economic trends; beats Q4 estimates

Oracle, bucking Wall Street trends by continuing to beat quarterly estimates, said today that it earned $2.3 billion, or 46 cents per share, on sales of $6.9 billion, a 5 percent revenue dip but still enough to beat Wall Street's estimates of 44 cents on $6.47 billion in sales. Earnings per share was 46 cents, down 1 percent. For the fiscal year, the company earned $1.44 per share, an 11 percent increase over last year, on revenue of $23.5 billion. (Statement)

Adjusted for one-time expenses, the company's net income for the quarter was down 7 percent to $1.9 billion and earnings per share was down 4 percent to 38 cents. For the year, adjusted net income was up 1 percent to $5.6 billion on revenue of $23.3 billion, up 4 percent from the previous year. Earnings per share was up 3 cents to $1.09.

For the second consecutive quarter, the company also issued a cash dividend of 5 cents per share. However, the company wasn't immune to global economics. New software licenses, which offer insight into future revenue from maintenance contracts, were down 13 percent for the quarter.

The company, which surprised the tech world during the quarter with an announced $7.4 billion acquisition of Sun Microsystems, said the quarter's results were impacted by the stronger dollar, compared to foreign currencies, and that, without the impact, the company's earnings per share would have been up 9 percent to 51 cents for the quarter. For the year, the value of foreign currencies had an 11-cent impact that would have otherwise resulted in EPS of $1.55. In a statement, Oracle President Safra Catz, said:

Adjusted for the substantial movement in the US dollar exchange rate this fiscal year, which is beyond our control, we grew non-GAAP earnings per share by 19 percent for the year. That's an amazing achievement given what's been happening in the global economy over the past twelve months.

In a call with analysts today, the company issued current quarter guidance of 29 cents to 31 cents per share and revenue to decline 3 percent to 5 percent. New software license revenue is expected to decline by a range of 4 percent to 14 percent.

However, the company noted that the guidance was conservative and doesn't include any assumption from the pending acquisition of Sun, a deal that the company said it expects to close in the current quarter.

Company president Charles Phillips wouldn't declare a bottom to the economic decline but did note that the customers no longer have that "sense of panic" that they had earlier this year about the economy. CEO Larry Ellison, who was also on the call, was bullish on Exadata, a storage server announced in September that he said has faster benchmarks and is less expensive that what the competition, notably Teradata, is offering.

Shares of Oracle were climbing in after-hours trading, up about two percent. In regular trading, shares were down slightly, closing at $19.87.