Oracle (ORCL) earnings Q2 2023

Oracle shares rose as much as 4% in extended trading on Monday after the software company reported results for the fiscal second quarter that topped analysts’ estimates. But it provided a lighter earnings forecast than analysts had predicted.

Here’s how the company did:

• Earnings: $1.21 per share, adjusted, vs. $1.18 per share as expected by analysts, according to Refinitiv.
• Revenue: $12.28 billion, vs. $12.05 billion as expected by analysts, according to Refinitiv.

With respect to guidance, Oracle said it expects $1.17 to $1.21 in adjusted earnings per share and 17% to 19% revenue growth in the fiscal third quarter. Analysts polled by Refinitiv had expected $1.24 per share and $12.34 billion in revenue, which implies 17.3% growth.

Oracle’s total revenue grew 18% year over year in the fiscal second quarter, which ended on Nov. 30, according to a statement. Health care software company Cerner, which Oracle acquired for $28 billion in June, contributed $1.5 billion in revenue.

Without the impact from foreign-exchange rates, Oracle’s adjusted earnings would have been 9 cents higher, the company said. Revenue for the quarter was over $200 million above the high end of its guidance range, Safra Catz, Oracle’s CEO, said in the statement. She cited strength in cloud infrastructure and cloud-based applications.

Net income was $1.74 billion, compared with a net loss of $1.25 billion in the year-ago quarter. Last year’s loss came in connection to a payment for a judgment tied to Mark Hurd, who previously served as co-CEO alongside Catz. Hurd died in 2019.

Oracle widened its adjusted operating margin to 41% from 39% in the previous quarter. Revenue in the company’s cloud services and license support segment increased 14% to $8.6 billion, higher than the $8.56 billion consensus among analysts polled by StreetAccount. Revenue from cloud infrastructure jumped 53% to $1 billion.

Revenue from cloud and on-premises licenses, at $1.44 billion, exceeded the $1.24 billion StreetAccount consensus.

In the quarter Oracle announced Alloy, a means for partners to run the company’s cloud services in their own data centers. Separately, the U.S. Securities and Exchange Commission fined Oracle $23 million over alleged violations of the Foreign Corrupt Practices Act.

Oracle said it was aiming for $65 billion in organic revenue, including Cerner’s contribution, in the 2026 fiscal year, with a 45% adjusted operating margin.

Prior to the after-hours move, shares of Oracle are down about 7% for the year, while the S&P 500 index has tumbled 15% over the same period.

Executives will discuss the results with analysts on a conference call starting at 5 p.m. ET.

This is breaking news. Please check back for updates.

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