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Oracle profits exceed estimates

Technology
San Francisco - Oracle posted third-quarter revenue and profit that topped analysts’ estimates, signalling growing demand for the software maker’s cloud-based services that compete with Amazon.com and Salesforce.com.

Profit before certain items was 69 cents a share, compared with an average estimate of 62c.

Adjusted sales rose 2.9 percent to $9.27 billion (R121.08 billion) in the period that ended on February 28, the Redwood City, California-based company said on Wednesday. On average, analysts had projected $9.26 billion, according to data. The report marked three straight quarters of revenue gains after more than a year of declines.

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Oracle says its overall sales from its cloud businesses have increased 62 percent in the recent period. Photo: AP

Oracle has been adding products and pushing customers toward its cloud-based business software and services, which offer computing and storage power from remote sites.

Oracle’s infrastructure offering, a product that goes head-to-head with Amazon Web Services, will eventually be the software company’s biggest cloud business, executive chairperson Larry Ellison said.

Read also: Google beats Oracle in $9bn Android trial

“These results show a nice upward inflection in the overall business as new cloud revenues are more than offsetting the declines in software licence sales,” Rodney Nelson, an analyst at Morningstar, said.

Sales from Oracle’s cloud businesses gained 62 percent in the recent period. New software licences, a measure that’s tied to Oracle’s traditional on-premise software business, declined 16 percent to $1.41 billion - smaller than the drop of 20 percent posted in the fiscal second quarter.

Oracle’s shares rose as much as 5.6 percent in extended trading.

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