Oracle Reports Strong Profits
P.J. Jakovljevic - January 3, 2000

Event Summary

Oracle Corp.'s second-quarter earnings rose 40 percent, exceeding even the most optimistic predictions made by the company's top executives last month. With old-line companies largely done fixing Y2K problems, sales are picking up for Oracle's flagship database and applications software, the company said. In addition, fast-growing Internet companies are buying Oracle software to help them manage vast amounts of data (See TEC News Analysis article: "IBM and Deutsche Telecom Announce Plans for 100 Terabyte Data Warehouse" December 17th, 1999). The Redwood Shores database software giant said net income for the quarter, ended Nov. 30, rose 40 percent to $384 million, or 26 cents a diluted share, compared with $274 million, or 19 cents a share in the same period last year. Securities analysts were officially predicting Oracle would earn 22 cents a share, according to First Call Corp., although many had quietly raised their estimates a few pennies after an upbeat briefing Nov. 16 by Oracle executives. Revenue increased to $2.3 billion in the quarter, compared with $2.06 billion a year ago. In addition, Oracle's costs are falling, as the company carries out efforts to cut $1 billion in annual expenses by using its own Internet-based business applications. The company said pre-tax profit margins improved by 5.5 percentage points, largely because of the cost-cutting campaign...