Beat by 1 cent.
Application Sales Up 66%, Database Sales Up 19%
Operating Margin increases 11 points to 36%
REDWOOD SHORES, Calif., Dec. 14 /PRNewswire/ --
[http://www.oracle.com/tellmemore/?505455]
Today, Oracle Corporation announced that second quarter net income increased
62% to $623 million, or $0.11 per share, while revenue grew to $2.7 billion.
This compares to $2.3 billion in revenue, $384 million in net income, and
$0.06 per share in Q2 last year. Applications software sales increased 66% to
$279 million, while database software sales grew 19% to $775 million. Total
software license revenue was up 25% to $1.1 billion, while total service
revenue increased 9% to $1.5 billion for the quarter.
"Our applications business is strong and getting stronger," said Oracle
CEO, Larry Ellison. "Oracle's new e-business suite puts every aspect of a
business -- marketing, sales, service, procurement, supply chain,
manufacturing, accounting, human resources -- everything, on the Internet.
All the applications in our suite are designed and engineered to work
together, so customers buying the entire suite don't need to do any systems
integration."
"Customers buying a part of the suite are doing systems integration to
connect our applications with applications from other vendors," Ellison
continued. "This quarter's results prove that we're winning more and more of
these best-of-breed battles against Ariba, I2, Seibel and other niche
specialists. And once a customer uses one of our applications, it's just a
matter of time before they move to the entire suite. Systems integration is
so complex and expensive that nobody really wants to do it."
"This quarter's numbers are even more impressive when you factor out
currency fluctuations," said Oracle Chief Financial Officer, Jeff Henley.
"The proper way to measure our growth year over year is in constant dollars.
Using that measure, quarterly applications software sales were up 73% while
database software sales were up 26%. Total license growth increased 32%.
That's stellar growth for a company our size. Add the fact that it took us
just two years to double operating margins and more than double profits, and
you have a measure of the strength of our business."
Oracle Corporation is the world's second largest software company. With
annual sales of more than $10 billion, Oracle provides the software that
powers the Internet. For more information about Oracle, please call Investor
Relations at (650) 506-4073 or visit Oracle on the web at www.oracle.com.
"Safe Harbor" Statement Under the Private Securities Litigation Reform Act
of 1995: Information in this release relating to Oracle's future prospects
which are "forward-looking statements" are subject to certain risks and
uncertainties that could cause actual results to differ materially, including,
but not necessarily limited to, the following: (1) Management's ability to
manage growth, continuously hire and retain significant numbers of qualified
employees, forecast revenues and control expenses, especially on a quarterly
basis, continues to be a challenge. An unexpected decline in the growth rate
of revenues without a corresponding and timely slowdown in expense growth
could have a material adverse effect on results of operations. (2) Oracle is
introducing new products, such as internet procurement and supply chain
management software, customer relationship management applications and
application hosting services, as well as assisting its customers in forming
exchanges for a number of business procurement needs; the market acceptance
and contribution to Oracle's revenues of these products and exchanges cannot
be assured. (3) Delays in product delivery or closing of sales can cause
quarterly revenues and income to fall significantly short of anticipated
levels. (4) Oracle has recently made changes to its pricing model which could
lead to a decline or delay in sales as its sales force and customers adjust to
the new pricing policies. Intense competition in the various markets in which
Oracle competes may also put pressure on Oracle to reduce prices on certain
products. (5) A weakening of the economy may affect the overall demand for
computer software and services which could result in decreased revenues or
lower revenue growth rates. (6) The market for Oracle's products is intensely
competitive and is characterized by rapid technological advances and frequent
new product introductions. There can be no assurances that Oracle will
continue to introduce new products and new versions of existing products that
keep pace with technological developments, satisfy increasingly sophisticated
customer requirements and achieve market acceptance. Oracle undertakes no
obligation to update information contained in this release. For further
information regarding risks and uncertainties associated with Oracle's
business, please refer to the "Risk Factors" section of Oracle Corporation's
SEC filings, including, but not limited to, its annual report on Form 10-K
and quarterly reports on Form 10-Q, copies of which may be obtained by
contacting Oracle Corporation's Investor Relations Department at
(650) 506-4073 or Oracle's Investor Relations website at
oracle.com
ORACLE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands, except per share data)
(unaudited)
Three Months Ended Six Months Ended
November 30, November 30,
----------------------- -----------------------
2000 1999 2000 1999
---- ---- ---- ----
REVENUES
Licenses and other $1,118,238 $902,632 $1,925,476 $1,534,813
Services1,541,308 1,419,251 2,995,945 2,771,587
---------- ---------- ---------- ----------
Total revenues 2,659,546 2,321,883 4,921,421 4,306,400
---------- ---------- ---------- ----------
OPERATING EXPENSES
Sales and marketing 640,865 631,433 1,213,829 1,169,859
Cost of services 694,998 753,170 1,368,876 1,509,920
Research and development 266,280 248,160 517,307 484,101
General and administrative 111,402 113,055 217,367 220,592
---------- ---------- ---------- ----------
Total operating
expenses 1,713,545 1,745,818 3,317,379 3,384,472
---------- ---------- ---------- ----------
OPERATING INCOME 946,001 576,065 1,604,042 921,928
Net investment gains
(losses) related to
marketable securities (A) (13,468) (5,083) 1,965 (8,423)
Other income, net 33,348 20,533 136,117 42,220
---------- ---------- ---------- ----------
INCOME BEFORE TAXES 965,881 591,515 1,742,124 955,725
Provision for income taxes 343,069 207,031 618,635 334,505
---------- ---------- ---------- ----------
NET INCOME $622,812 $384,484 $1,123,489 $621,220
========== ========== ========== =========
EARNINGS PER SHARE (B)
Basic $0.11 $0.07 $0.20 $0.11
Diluted $0.11 $0.06 $0.19 $0.10
WEIGHTED SHARES OUTSTANDING (B)
Basic 5,584,428 5,717,780 5,594,243 5,719,812
Diluted 5,874,987 6,012,600 5,903,929 5,988,704
-----------------------
(A)Net investment gains (losses) related to marketable securities relate
to actual sales of marketable securities, and the Company's equity
share in the results of non-consolidated subsidiaries.
(B) All earnings per share and weighted shares outstanding amounts have
been adjusted to reflect a 2:1 stock split during the quarter ended
November 30, 2000.
ORACLE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
($ in thousands)
November 30, May 31,
2000 2000
---- ----
(unaudited)
ASSETS
Current Assets
Cash and short term investments $4,356,165 $7,761,998
Trade receivables, net 1,935,767 2,533,964
Prepaid and refundable income taxes 223,837 212,829
Other current assets 307,695 374,543
---------- ----------
Total Current Assets 6,823,464 10,883,334
---------- ----------
Long-term cash investments 30,000 110,000
Property and equipment, net 941,793 934,455
Prepaid taxes - long term 289,624 322,379
Other assets 838,886 826,611
---------- ----------
TOTAL ASSETS $8,923,767 $13,076,779
=========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Notes payable, including current maturities $2,596 $2,691
Accounts payable 282,738 287,495
Income taxes 526,492 2,821,776
Customer advances and unearned revenues 1,053,809 1,133,482
Other current liabilities 1,301,990 1,616,794
---------- ----------
Total Current Liabilities 3,167,625 5,862,238
---------- ----------
Long-term debt 300,802 300,770
Long-term liabilities 191,257 186,178
Deferred income taxes 337,620 266,130
Stockholders' equity 4,926,463 6,461,463
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $8,923,767 $13,076,779
=========== ==========
SOURCE Oracle Corporation
-0- 12/14/2000
/CONTACT: Stephanie Aas, Investor Relations of Oracle Corporation,
650-506-4073/
/Web site: oracle.com
(ORCL)
CO: Oracle Corporation
ST: California
IN: CPR MLM
SU: ERN
JO
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