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Technology Stocks : Oracle Corporation (ORCL) -- Ignore unavailable to you. Want to Upgrade?

To: Sarkie who wrote (11101)	6/15/1999 8:13:00 PM
From: Richard Habib	Read Replies (3) \| Respond to of 19079

Here is my synopsis of CC question portion. Asked why so cautious in last analyst meet. Responded they didn't know why Q3 was anomalous. Later stated no idea why closures were soft in Q3. Very hard to forecast given the Y2K thing. CRM products seemed linked to ERP products in small to mid but not in majors. Have CRM customers on SAP. Have seen some SAP displacement in ERP. Believe customers see modern internet based CRM product and switch to Oracle ERP. Believe that technical selling is reaching higher into customers organization and that apps sellers comes in later. This is good for Oracle since they are heavily tech proficient and have the best tech. Back to costs, LE has implemented a zero based cost program so changing the attitude. Now is sales up they want their managers coming into budget meetings saying they need less money. Since zero line costs implemented for 1st time in 7 years any top line growth should flow to bottom. Again margins are bad now compared to MSFT or CA so alot of headroom and think they can achieve the 30% target in 18 months primarily by adopting their own tech. As far as Y2K resulting in a nuclear winter they have heard some companies are freezing production for a few months but may not affect software purchases. At this critical time how may companies can afford not to move ahead in ebusiness. Still there may be problems in Asia. Overall think they will be fine. If they were just ERP (like some of their competitors) they would be worried but with CRM and other products as above feel good. Unearned revenue increase is typical of Q4 because lots of big license contracts come in that have support with them for next 12 months. Must be booked as unearned until support contract complete. Sales force is enthused about new sales reorg. This actually came from field. 4 months ago RL didn't intend to reorg sales but sales managers said if they dont' get strict ownership and accountability they were gone. Believe the trend of the company is best represented by a line thru Q1, Q2 and Q4. Pointed out how far they have come in a year. Only last year were just splitting apps and DB. Just getting v11 DB out. Now look at products and ales focus. Believe they are building in growth rate into product strength. See no reason growth won't continue. Standarizing price structure outside firewall. Before lots of one off contracts. Need to standarize to implement automation of sales. Prices standarizing on mips. Customers will get 2 or 3 choices of contracts. Pointed out the fact of sales quotas already out vs usually Aug. Pointed out that last year on one contract 17 people paid commission. Had 31 people needed to determine sales comps. Now 1 salesperson owns account. "Everyone knows who they are selling to and what they are selling and are out selling it now" Verticals use to have just apps now have moved over 100-200 DB accounts to verticals. Major account reps have moved over to verticals so no disruption in accounts. Focus is on efficiency, total ownership and total accountability. Growth in verticals, general business, majors, federal and overseas pretty evenly balanced. Majors are behind GB but caught up quite some in Q4. This disputes idea that growth is in small to mid. "It's across the board" They are considered SAPs primary competitor indicating strenth in majors. DB growth breaks down to roughly 30% from third pary app providers SAP, BAAN and PSFT and 20% from their own apps. Point questioner was making here is third party ERP app growth is non-existent right now. That's about it. All other info from questions integrated in my last post. Overall they were upbeat and while you may see some picking at growth numbers next few days all the analysts seemed to be impressed and there was little harping on negatives. Rich