Oracle’s reported financial results exceeded Wall Street’s expectations. Oracle’s results indicate that there is still a strong demand for technology that helps companies automate administrative tasks. Oracle’s chief financial officer, Safra Catz, said that the company did not think investors would mind hearing about a solid quarter amid fears about Europe’s shaky economy and its effect on business conditions.
Oracle reported an 8% increase in net income for its fiscal fourth quarter. Oracle earned $3.45 billion, or $0.69 a share, for the quarter ending in May. This was up from net income of $3.2 billion, or $0.62 a share, for the same quarter last year.
Oracle would have earned $0.82 a share excluding acquisition expenses and other costs. Analysts surveyed predicted an average estimate of $0.78 a share. Revenue increased slightly by 1% from last year to $10.9 billion. The revenue results were slightly higher than analyst estimations.
The company also posted a 7% increase in its sales of new software licenses. Oracle sells software and high-end computers to companies and government agencies around the world. Sales of new software create a stream of future revenue earned from maintenance and software upgrades. Oracle expects software licenses to range from a 1 % decrease to a 9 % increase for the current quarter ending in August from the same time last year. Revenue earned the sale of hardware products decreased by 16% during the latest quarter from the same quarter last year. Oracle has struggled to diversify into hardware.
The company also announced that it would buy back up to $10 billion of its shares. Oracle’s decision to buy back an additional $10 billion of its stock could increase future per-share earnings by decreasing the amount of shares outstanding. Oracle bought back 207 million shares in its last fiscal year, spending about $6 billion.