Oracle posts 'record year' results in Asia-Pacific

Company's strong performance suggests some upturn in the market and, hopefully, sustainable levels of activity.

Oracle ended fiscal 2005 on a high note in the Asia-Pacific, suggesting a pickup in regional IT spending.

For the full year ended May 31, 2005, Oracle posted total Asia-Pacific revenues of US$1.7 billion, a 15 percent increase compared to last year. New license revenues for applications and technology--database and middleware--grew 46 percent and 12 percent respectively.

For the fourth quarter, regional revenues grew US$540 million, a 23 percent increase over its results for the same period last year. New license revenues for applications and technology grew 80 percent and 10 percent respectively.

Derek Williams, executive vice president for Oracle Asia-Pacific, told ZDNet Asia in an interview: "We exceeded our analyst expectations globally, and I believe our results here have exceeded analyst expectations for Asia-Pacific."

Calling this "a record year" for the regional business, Williams said: "There does seem to be an upturn in IT spending."

 Derek Williams, Oracle
Derek Williams,
executive vice president
Oracle Asia-Pacific

The upturn has been across the Asia-Pacific, excluding Japan. "It's not just in the fast-growing countries of, say, China and India, but it seems to be growing fairly well in all geographies with the exception of Japan," he noted.

Japan, Williams said, remains "fairly flat". "That's true for almost everybody and every industry. Japan's economy has really been driven by exports out of Japan rather than a domestic economy," he explained.

Australia, Hong Kong, Taiwan, and other smaller economies like the Philippines and Thailand "have also done well", Williams added.

"I think it's encouraging. What this tells me is that the upturn in IT spending, I believe, is a recognition by companies that the automation of supply chains, that the investment in IT, is a worthwhile proposition given the conflicting forces of higher oil prices, the strength of the US dollar and, in some countries, escalating interest rates," noted the industry veteran.

Comparing these positive results with those seen in previous years, Williams said "it has been in fits and starts". "There have been peaks or maybe an individual quarter with an individual product line that did relatively well, but I'm wondering if this is a return to the years of 1993 to 1997, in particular where there was significant growth for all businesses."

The elated chief, however, remained cautious when asked to confirm if the market has returned to pre-1997 levels, saying "it is still too early to say".

He added: "We've got to be careful of not having the same problems that 1997 brought, which was obviously expanding too fast."

But Oracle's latest numbers, he emphasized, point to strong demand of database and enterprise applications. "Whichever way you look at these, you're starting to see growth numbers of substance," he noted. "These are numbers we've not seen for a while from anybody.

"What I believe, therefore, is that the adverse factors are being taken into account by businessmen, and they're saying that now is the time to be investing in technology so as to compete on a worldwide stage," he added.

Williams also attributed Oracle's strong performance to other factors, including the company's ability to execute strategies as planned and a stronger value proposition bolstered by the PeopleSoft acquisition.

"I believe we've the most compelling software story, because we've the technology with our database, we're increasing market share across the world, we (offer) performance and security, and we're moving to lower-cost platforms like Linux," he said.