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

To: Roy F who wrote (8292)	9/11/1998 8:21:00 AM
From: Bipin Prasad	Read Replies (1) \| Respond to of 19080

from wsj: Oracle Fiscal 1st-Quarter Net Rose As Database Products Rebound By DON CLARK Staff Reporter of THE WALL STREET JOURNAL Oracle Corp. topped expectations for fiscal first-quarter profit, as the company's flagship database products continued to rebound from a jolting slump last year. The Redwood Shores, Calif., company said net income in the first quarter ended Aug. 31 rose to $195 million, or 20 cents a diluted share, from the year-earlier mark of $8.5 million, or one cent, including one-time acquisition charges. Excluding those charges, Oracle said its net was up 30%, and was four cents a share higher than analysts' consensus estimate of 16 cents, as tallied by First Call. Revenue rose 28% to $1.7 billion. Oracle is a major player in corporate computing, with software that serves as a foundation for complex programs that companies use to run their businesses. Though it has commanding market share in databases, the company's turf has been targeted by Microsoft Corp. for stiff price competition. Oracle's results in last year's fiscal second quarter also triggered worries that demand for databases has been slacking off, as companies that purchased software in earlier years take time to finish developing new business applications built on Oracle's products. Impressive Growth Thursday, however, Oracle said revenue from selling databases grew 17% in the latest period, on top of gains of 13% for the two prior periods. The growth was even more impressive when the effects of slumping Asian markets were excluded, said Jeffrey Henley, the company's executive vice president and chief financial officer. Oracle's database revenue in its Americas division grew 23%. Speaking to a gathering of reporters Wednesday, Oracle Chairman Lawrence Ellison said price reductions designed to meet competition was a major factor in the earlier revenue slowdown. Now customers are stepping up buying again. "We were surprised by how strong database demand was in this last quarter," Mr. Ellison said. "It was breathtaking." Oracle issued its results after stock markets closed. Its shares closed at $22.125 in Nasdaq Stock Market trading, up 31.25 cents, and rose to $24.50 in after-hours trading. Among big U.S. software companies, Oracle has been particularly hurt by Asian economic distress, including devaluations of foreign currencies against the dollar. Oracle said sales in Asia were down 14% in absolute terms, but were up 7% when the effects of currency changes were excluded. Mr. Henley said currency changes have fluctuated, but demand hasn't rebounded. "Asia isn't going to get better for another year or so," he said. Trouble Spot Oracle also has had trouble exploiting demand for application programs that work on its databases. The company said sales of its application programs, excluding related service revenues, were flat compared with the year-earlier period. Sales of programming tools declined 12%, the company said. The company, which already boasts about supplying software for many of the largest Web sites, is hoping to add to its lead in the field with a new version of its flagship database software, which will be formally announced Monday. Called Oracle8i, the software includes a range of features that the company says give it attributes of a full-fledged operating system for Internet business applications. The product also can be customized using Java, the programming language from Sun Microsystems Inc. that is all the rage in elite software circles. "Java is very cool," Mr. Ellison said. "It's been a long time since Oracle's been cool."