Oracle shares slide after earnings miss
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NEW YORK Oracle (ORCL) on Wednesday reported flat earnings for its fiscal third-quarter, hurt by a drop in sales of hardware systems and new software. Shares tumbled in after-hours trading on the weaker-than-expected results.
Revenue from new software licenses and online or "cloud" subscriptions, a closely watched figure, fell 2 percent year-over-year to $2.3 billion. The company had predicted that number would rise by 3 percent to 13 percent. Sales of hardware systems products dropped 23 percent.
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As one of the world's largest makers of business software, Oracle's numbers help Wall Street gauge the direction of corporate technology budgets. When Oracle's earnings are lackluster, it's often a sign that companies are concerned about the economy.
But Oracle also depends on international markets for a major part of its revenue. Europe's economy is still limping amid worries about unwieldy government debts and China's economic growth has been slowing.
Oracle earned $2.5 billion, or 52 cents per share, in the December-February quarter. That compares with $2.5 billion, or 49 cents per share, in the same period a year earlier, when it had more shares outstanding. Adjusted earnings totaled 65 cents per share in the latest quarter.
Revenue fell 1 percent to $8.96 billion from $9.04 billion, hurt in part by the stronger dollar.
Analysts polled by FactSet had expected earnings of 66 cents per share, excluding charges for past acquisitions and other costs, on revenue of $9.38 billion.
Shares of the Redwood City, Calif., company fell $2.76, or nearly 8 percent, to $33 in after-hours trading following the announcement. The stock had closed the regular session up 8 cents at $35.76 before the report.
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