Oracle Corporation Shares Slump After Hours As Profits Decline

Oracle released its latest earnings report after closing bell tonight, posting 61 cents per share or $2.6 billion in non-GAAP earnings on total revenue of $9 billion. Analysts had been expecting earnings of 60 cents per share on $9.1 billion in revenue. In the same quarter a year ago, the cloud services provider reported 63 cents per share in adjusted earnings on $9 billion in revenue.

Oracle’s profits fall

GAAP net income amounted to $2 billion or 48 cents per share, down from the year-ago quarter’s 51 cents per share or $2.2 billion.

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Oracle’s non-GAAP revenues rose 1% year over year to $9.1 billion. Cloud software as a service and platform as a service revenues surged 81% year over year to $878 million, while non-GAAP SaaS and PaaS revenues jumped 87% to $912 million. Total cloud revenues, including infrastructure as a service, rose 62% year over year to $1.1 billion. Cloud plus On-Premise Software revenues rose 2% to $7.2 billion. Short-term deferred revenues rose 6% to $7.4 billion in the quarter.

“For four consecutive quarters our Cloud SaaS & PaaS revenue growth rate has increased,” Oracle Chief Executive Safra Catz said in a statement. “As we get bigger in the cloud, we grow faster in the cloud.”

Oracle still targeting Salesforce

Once again, Oracle management highlighted the company’s performance versus its competitor Salesforce.

“When crossed the billion dollar milestone their SaaS and PaaS subscription growth rate had slowed down to 36%, even after you include all their acquisitions,” she said.

“Oracle has now passed and become number one in SaaS cloud applications sales to customers with over 1,000 employees according to the latest IDC report,” said Oracle Chief Executive Mark Hurd. “In other words, this year we are selling more enterprise SaaS than any cloud services provider in the world. We expect to book over $2 billion in new annually recurring cloud business this year alone. And, with the acquisition of NetSuite, we plan on being the #1 cloud applications service provider for companies with less than 1,000 employees as well.”

Shares of Oracle dropped by as much as 2.1% to $40 per share in after-hours trades