Software maker's 1Q earnings in line with forecasts but sales disappoint. Stock down in pre-markets.
September 12, 2003: 7:53 AM EDT
NEW YORK (CNN/Money) - Software maker Oracle Corp. reported an earnings increase in its fiscal first-quarter Friday, but the stock plunged in pre-market trading due to lower-than-expected sales.
The database software giant earned $440 million, or 8 cents a share, in line with the consensus forecast of analysts surveyed by earnings tracker First Call, and up from $343 million, or 6 cents a share, in the year-earlier period. It earned 7 cents a share excluding special items in the year-earlier period, and operating margins improved to 30 percent from 29 percent a year earlier.
But sales came in at $2.07 billion, falling short of Wall Street's consensus estimate of $2.14 billion. Sales in the same quarter a year ago were $2.03 billion.
Shares of Oracle (ORCL: Research, Estimates) plummeted 5.4 percent in pre-market trading, to $12.28, according to Island ECN. The stock gained 13 cents, to $12.98, in regular trading Thursday.
New software license sales were a major disappointment, falling 7 percent from a year ago, to $525 million. New software licenses are viewed closely by Wall Street because they are a measure of whether or not Oracle is adding more customers.
Oracle's fiscal first quarter is typically its weakest, but the market was not expecting license revenue to fall short by such a large amount. Jason Brueschke, an analyst with Pacific Growth Equities, was forecasting new license sales of $589 million. David Hilal of Friedman Billings Ramsey was predicting sales of $584 million.
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