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

To: mike fredricks who wrote (3466)	10/23/1997 4:06:00 PM
From: Li Cai	Read Replies (1) \| Respond to of 19080

Will ORCL gets another new low?

To: mike fredricks who wrote (3466)	10/23/1997 4:30:00 PM
From: Eric	Read Replies (1) \| Respond to of 19080

You have a point. The talk has been on how margin will suffer because of the pricing pressure on NT. But the truth is Oracle gets 50% of its revenue from service and consulting. While license revenue may suffer despite more new customers, Oracle's consulting business will benefit from the ever increasing customer base. The question is how the two will balance out. I had the luck (I hope) of picking up more Oracle shares at the open today. While at the near term I do not see any substantial run up in those shares I believe they will pay off 3-4 month down the line.

To: mike fredricks who wrote (3466)	10/23/1997 6:08:00 PM
From: Mark Finger	Respond to of 19080

re: Margins. First, Microsoft's last margin after tax was 31%. Second, the 10% I gave for Sybase was actually below what the had over the period, and is not that much below Oracle's for the last 6 quarters (13-14%). Finally, Microsoft is in a unique situation. They average over $60 royalties for every PC sold, because of Windows and other components pre-loaded on the machine. This is extremely high margin sales that Oracle has no equivalent for (unless the NC really takes off, which could give them an equivalent stream, but they spun that out to a separate company). You do not get that kind of margins on any personell costs, because you forgot to include the "load" on the salaries of most consultants. Unless you can figure out a royalty stream like Microsoft's OS and suite revenues, the top after-tax margin for Oracle is about 20%.