Wednesday, September 15, 2004

Oracle profit up, but applications sales down

Oracle reported quarterly earnings this week, which showed a 16% increase in profit over the same quarter a year ago, on a revenue increase of 7%. Oracle is now a $2.22 billion company.

That's the good news. The bad news is that new license sales of Oracle applications (E-Business Suite) fell 36%. An increase of 18% in sales of Oracle's database software apparently was enough to overcome the drop in application software sales.

Oracle CFO said that the shortfall was not due to Oracle's protracted takeover battle with PeopleSoft. He said that it was due in part to a few deals that didn't close in the first quarter but are expected to close in the second quarter. We're starting to hear this explanation more and more from software vendors. What they never say, however, is whether some deals in the next quarters might also be "delayed."

Oracle's fall off in application sales puts Oracle in the same position as just about every other application software seller lately, except SAP. One big difference, of course, is that Oracle has a huge business in database and tools to counteract weakness in the application business.

Related posts
Flash: Court refuses to block Oracle takeover of PeopleSoft
Rumor: QAD cuts 30 heads
SAP keeps on keepin' on
Some analysts fail to see Conway's elephant
PeopleSoft earnings coming up short

No comments: