Silver Lining to Oracle’s Q4 Earnings Miss

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The release of Oracle Corporation’s Q4 earnings was more heavily anticipated this year than in previous years. This was in part because Oracle had missed Wall Street targets in Q3 and the bulls and bears were both taking strong positions for or against the technology bellwether. Also, Oracle always makes a huge sales push in Q4. Yet, when Oracle released its earnings after the bell on June 20th, the stock was immediately hammered and closed the following day down more than 9%.

The analysts who have long sought to bring down Oracle’s captain came up with the usual jibes at Oracle’s CEO, Larry Ellison. For example, how he is too focused on Team Oracle's performance in the America’s Cup yachting event, or his oft-quoted 2008 remark about cloud computing—“Maybe I’m an idiot, but I have no idea what anyone is talking about.” What these analysts have failed to see is that now Oracle is mounting an all-out assault on all fronts of the cloud—IaaS (Infrastructure as a Service), PaaS (Platform as a Service), and SaaS (Software as a Service).

As noted by Oracle President Mark Hurd, “Oracle’s HCM Cloud, CRM Cloud, and ERP Cloud grew 50% as we added over 500 new SaaS customers in Q4 alone. Our annualized SaaS revenue run rate is over $1 billion.” Also, in only two short days, Oracle has declared a truce with Microsoft and Salesforce, announcing strategic partnerships with both.

Oracle plans to integrate with Oracle’s Fusion HCM and Financial Cloud, and provide the core technology to power's applications and platform. will also implement Oracle’s Fusion HCM and Financial Cloud applications throughout the company.

The Microsoft partnership will enable customers to deploy Oracle software—including Java, Oracle Database, and Oracle WebLogic Server—on Windows Hyper-V Server or in Windows Azure and receive full support from Oracle. plans to standardize on the Oracle Linux operating system, Exadata engineered systems, the Oracle Database, and Java Middleware Platform.

The silver lining in all this is that businesses of all sizes will benefit from the strong push by Oracle into the cloud. Oracle’s customers will benefit by having additional cloud offerings available to them, both from Oracle and from the additional partnerships Oracle is forging in the cloud. The other cloud providers must step up their game to either stay ahead of Oracle in their niche, or be overtaken by the man who successfully defeated the likes of Sybase and Informix long ago.
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