Yesterday, Oracle Corporation (NYSE:ORCL) reported its fiscal first quarter results. The company earned 59 cents a share, beating the consensus estimate of 56 cents per share. However, its first quarter revenues of $8.38 billion fell short of Wall Street expectations of $8.48. The world’s second largest software maker issued second quarter earnings and revenue guidance that missed analysts’ expectations.

Oracle Corporation (ORCL) Issues Cautious Q2 Guidance

Smaller firms challenging Oracle

Oracle Corporation (NYSE:ORCL) is facing stiff competition from smaller rivals. Small software companies are offering internet-based products and software at competitive prices. The Larry Ellison-led company is also battling weak global IT demand. For the second quarter, Oracle Corporation (NYSE:ORCL) expects new software and subscriptions revenue growth to range between -4% and 6%. Wall Street follows new software sales closely because they bring long-term, high margin contracts, thus indicate future earnings potential.

The company estimates second quarter non-GAAP EPS of 65-70 cents per share, compared to the consensus estimate of 69 cents. Overall revenues are expected to grow at 1% to 4% during the current quarter. That translates between $9.02 billion and $9.29 billion, reports Noel Randewich of Reuters.

Oracle CEO misses the conference call

Oracle Corporation (NYSE:ORCL) issued its second quarter forecasts at a conference call after announcing its Q1 earnings on Wednesday after the bell. However, Oracle Corporation (NYSE:ORCL) CEO Larry Ellison missed the conference call to attend his sailing team, Oracle Team USA’s match against the New Zealand team. Ellison is set to launch the In-Memory Option for the Oracle Corporation (NYSE:ORCL) database at the oracle OpenWorld next week.

Oracle Corporation (NYSE:ORCL) is shifting its focus to cloud computing as its software and hardware businesses face growth challenges ahead. According to a survey conducted by Barclays Plc. (LON:BARC) (NYSE:BCS), global IT spending is expected to remain flat in the second half of this year. Analysts expect Oracle Corporation (NYSE:ORCL) to become more competitive with increased focus on cloud computing.

Oracle Corporation (NYSE:ORCL) shares were down 0.94% to $33.55 in the early trading session. The stock is up 2.57% this year so far.