Oracle's first quarter results for fiscal 2010 registered a net income of $1.1 billion, or 22 cents per share, for the three months ending Aug. 31. That was up 8% from earnings of $1.07 billion, or 21 cents per share, a year earlier.

The company did experience a drop in sales that was caused in large part by weakness in Europe, the Middle East and Africa, a region where revenue was down about 10 percent from last year to $1.64 billion, reported the Associated Press.

Sales for Oracle, the world's third largest software maker, fell 7% to $5.1 billion in the quarter. New software licenses sales dropped 17% to $1 billion, while software license updates and product support revenues rose 6% to $3.1 billion. Oracle Executive Vice President and CFO Jeff Epstein actually places some of these numbers higher stating, "Software license updates and product support revenues grew 11%, to $3.1 billion, for the quarter when adjusted for the change in the US dollar since last year."

Impacted by the reduced value of foreign currencies when compared to US dollars, Oracle contends its new software license revenues would have been down only 14%, software license updates and product support revenues would have been up 11% (GAAP) and up 8% (non-GAAP), while operating income would have been up 21% (GAAP) and 11% (non-GAAP).

Safra Catz, Oracle's president, addressed concerns about sales in Europe during a conference call following Oracle's quarterly earnings report released September 16. "As you know, August, the summer in Europe, is always not great. The last year, we actually had a very, very good summer," Catz said. "We did actually start to see some of the economies in Europe improve a little bit, in just our overall outlook and expectations ... we do actually see the economies little by little starting to lighten up, which is a good thing."

Catz said on the conference call she expects operating margins to keep rising on a year-on-year basis as Oracle continues to book a higher percentage of revenue from its maintenance business, which brings in higher margins.

Oracle also declared a cash dividend of 5 cents per share of outstanding common stock, which will be paid November 4.

More Information

Oracle Press Release

Full release and financials

Conference call webcast replay [...read more...]

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