Archive for September 17th, 2010

Article from SF Gate.

Oracle Corp. reported profit and revenue that beat analysts’ estimates as sales of database software and Sun Microsystems server computers helped it capitalize on a recovery in information-technology spending.

First-quarter earnings excluding acquisition costs and other expenses were 42 cents per share, Redwood City‘s Oracle said Thursday in a statement. That topped the 37 cent average of projections compiled by Bloomberg.

The world’s second-largest software maker is taking advantage of improvements in corporate spending by offering a wide range of software products it’s assembled through acquisitions. Oracle also gained computer hardware with its $7.3 billion purchase of Sun in January. The hiring of Mark Hurd as co-president this month may help the company manage Sun and expand into new areas of hardware, analysts said.

“Oracle is probably the best indicator in the software space of the overall spending environment in IT right now,” said Yun Kim, an analyst at Gleacher & Co. in Greenwich, Conn., who recommends buying the shares and doesn’t own any himself. Most software projects at companies require database programs, which benefits Oracle, he said.

Oracle rose 4.1 percent to 26.40 in extended trading after closing at $25.36 at 4 p.m. on the Nasdaq Stock Market. The stock has gained 3.4 percent this year.

The company reports sales that include deferred revenue from acquired companies and don’t conform to generally accepted accounting principles. On that basis, sales in the period ended Aug. 31 jumped 50 percent to $7.59 billion. Analysts on average predicted $7.32 billion.

Oracle is the largest seller of database software, second to SAP AG in business applications, and the No. 2 provider of application-connecting middleware after IBM Corp. Its goal for Sun, a money loser at the time of the acquisition, is to contribute $1.5 billion in operating income during its first year in the fold.

The company will unveil “two high-end systems that combine Sun hardware with Oracle software” at next week’s Oracle OpenWorld show in San Francisco, Hurd said in the statement.

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