Oracle Corp. (ORCL: Quote) said Tuesday after the markets closed that its third quarter profit rose 18% from last year, helped by higher sales of its softwares.
The company's quarterly earnings per share, excluding items, also came in above analysts' expectations as did its quarterly revenue.
Oracle shares are currently gaining more than 2% in after hours trading after closing the day's regular trading session at $30.10, up 34 cents or 1.14%. The shares trade in a 52-week range of $24.72 to $36.50.
Oracle's total software revenues for the third quarter increased 8% year-over-year to $6.4 billion. New software license revenues for the quarter grew 7% from a year earlier to $2.0 billion, the tenth consecutive quarter of growth.
Third quarter software license updates and product support revenues increased 8% year-over-year to $4.1 billion. Service revenues for the quarter remained essentially flat with last year at $1.1 billion.
Hardware systems revenues for the quarter fell 11% at $1.5 billion, with hardware systems products revenue down 16% and hardware systems support revenue down 4%.
Oracle's acquisition-led growth strategy continues to pay dividends. The company has acquired more than 70 companies since 2005. The company completed its much awaited $7.4 billion acquisition of Santa Clara, California-based Sun Microsystems in January 2010.
The acquisition of Sun was Oracle's biggest acquisition since its $8.5 billion takeover of BEA Systems Inc. in 2008 and the $11.1 billion acquisition of PeopleSoft Inc. in early 2005.
Of late, Oracle has set its eyes on cloud-based software firms. In January, the company completed the acquisition of RightNow Technologies, Inc. (RNOW) for $1.5 billion in an effort to offer a broader range of cloud solutions to its customers. Last month, Oracle agreed to buy Taleo Corp. (TLEO) for about $1.9 billion, net of cash and debt.. The deal is expected to close in the middle of 2012.
For the third quarter ended February 29, 2012, Redwood Shores, California-based Oracle reported net income of $2.5 billion or $0.49 per share, compared to $2.1 billion or $0.41 per share for the year-ago quarter.
Excluding items, adjusted net income for the third quarter was $3.1 billion or $0.62 per share, compared to $2.8 billion or $0.54 per share in the prior year quarter.
On average, 36 analysts polled by Thomson Reuters expected the company to earn $0.56 per share for the third quarter. Analysts' estimates typically exclude special items.
Operating margin for quarter improved to 37% from 34% a year earlier, while adjusted operating margin grew to 46% from 44% last year.
"Oracle is on track to deliver the highest operating margins in our history this year," said Oracle President and CFO, Safra Catz. "Oracle can achieve these record margins as an integrated hardware and software company because we are focusing on high margin systems where hardware and software are engineered to work together."
The world's second largest software maker said total revenue for the third quarter rose 3% to $9.04 billion from $8.76 billion a year ago, while adjusted revenue for the quarter also increased 3% to $9.06 billion from $8.81 billion last year. Thirty-four analysts had a consensus revenue estimate of $9.02 billion for the third quarter.
Oracle also declared a quarterly cash dividend of $0.06 per share, payable on May 2 to shareholders of record on April 11.
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by RTT Staff Writer
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