Oracle delivered a better-than-expected fourth quarter courtesy of strong hardware sales---notably an operating profit at Sun and strong sales of Exadata database machines.
The company on Thursday reported earnings of $2.4 billion, or 46 cents a share, on revenue of $9.5 billion (statement, preview). Non-GAAP earnings were 60 cents a share, well ahead of the 54 cents a share expected by Wall Street. Sales were in line with expectations, but Oracle's profit got a boost from better-than-expected hardware sales.
Sun contributed about $400 million in non-GAAP operating income. You could call the performance Oracle's Sun miracle. In a statement, Oracle CFO Jeff Epstein said Sun had $1.2 billion in systems revenue. Oracle president Safra Catz said:
Now that Sun is profitable, we have increased confidence that we will meet or exceed our goal of Sun contributing $1.5 billion to non-GAAP operating income in FY2011, and $2.0 billion in FY2012.
Also on the hardware front, Oracle CEO Larry Ellison talked up his pet project: The Exadata database machine. Ellison also took aim at IBM:
Some of IBM's largest customers began buying Exadata machines rather than big IBM servers in Q4 of FY2010. And the FY2011 Exadata sales pipeline is fast approaching the $1 billion mark.
With all this talk about hardware, you could almost forget that Oracle is selling its database and applications.
Here's a look at the moving parts:
Other key figures:
- Oracle ended its fiscal year with 104,569 employees down from 106,492 a quarter ago.
- Revenue in the Americas for the fourth quarter was $4.88 billion, up from $3.46 billion a year ago. Europe, Middle East and Africa revenue in the quarter was $3.15 billion, up from $2.41 billion. Asia Pacific revenue in the quarter was $1.46 billion, up from $985 million a year ago.
- On Demand revenue was $295 million in the fourth quarter, up from $204 million a year ago.
- For the year, Oracle reported net income of $6.1 billion, or $1.21 a share, on revenue of $26.8 billion, up 15 percent from a year ago.