Oracle predicts bullish third quarter as IT spending rebounds, Telecom News, ET Telecom

By Akash Sriram

Enterprise software maker Oracle Corp forecasted earnings and revenue for the current quarter above market estimates on Thursday after releasing optimistic second-quarter results, helped by higher technology spending from companies looking to support hybrid work.

As the pandemic has pushed more companies to switch to a hybrid work model, spending on cloud technology has increased, benefiting Oracle and other companies such as Salesforce, Inc and Microsoft.

Shares of the company rose about 10.4% to $ 98 on extended trading.

Revenue for Oracle’s largest cloud services and licensing support unit reached $ 7.55 billion in the second quarter, from $ 7.11 billion a year earlier. That figure is expected to grow between 6% and 8% in the third quarter, the company said.

Oracle has stepped up its investments in data centers around the world, especially government-focused ones, CEO Safra Catz said on a conference call with analysts.

About 75% of Oracle Enterprise Resource Planning (ERP) customers have not moved to the cloud, and the company has a very good chance of moving them and increasing its ERP revenue, said Scott Kessler, analyst at Third Bridge.

The company expects earnings for the current quarter of between $ 1.19 per share and $ 1.23 per share, higher than Refinitiv IBES ‘estimate of $ 1.16 per share. It projects revenues of $ 10.7 billion to $ 10.9 billion, according to Reuters calculations, above estimates of $ 10.56 billion.

Oracle said it made a payment for a judgment related to a dispute over the employment of former CEO Mark Hurd, which resulted in a third-quarter loss of $ 1.25 billion to $ 2.44 billion in profit. dollars a year earlier.

On an adjusted basis, the company earned $ 1.21 per share on revenue of $ 10.36 billion. Analysts expected earnings of $ 1.11 per share and revenue of $ 10.21 billion, according to IBES data from Refinitiv.

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