Oracle Chairman and Chief Technology Officer Larry Ellison speaks at the Oracle OpenWorld conference in San Francisco on September 16, 2019.
Justin Sullivan | Getty Images News | Getty Images
Oracle Shares slipped more than 7% on Tuesday afternoon, a day after the database software company reported second-quarter fiscal results that fell short of analysts' estimates and issued a weaker-than-expected forecast .
Here's how Oracle compared to the LSEG consensus:
- Earnings per share: $1.47 adjusted versus $1.48 expected
- Income: $14.06 billion vs $14.1 billion expected
Oracle's second quarter sales grew 9% year over year.
Net income increased 26% to $3.15 billion, or $1.10 a share, from $2.5 billion, or 89 cents a share, a year earlier. Revenue in Oracle's cloud services business jumped 12% from a year earlier to $10.81 billion, accounting for 77% of total revenue.
Oracle's biggest growth engine has been cloud infrastructure, where it competes with Amazon, Microsoft and Google as businesses move workloads out of their own data centers.
The industry is thriving due to high demand for computing power that can handle artificial intelligence projects. Oracle said revenue in its cloud infrastructure unit rose 52% from a year earlier to $2.4 billion.
Oracle said it has just signed an agreement Metaallowing the social media company to use its infrastructure to help with various projects related to the Lama family of large language models.
“Oracle Cloud Infrastructure trains several of the world's most important next-generation AI models because we are faster and cheaper than other clouds,” said the Oracle founder Larry Ellison said in a statement.
For the current quarter, Oracle expects revenue growth of 7% to 9%. At the midpoint of that range, revenue would be around $14.3 billion. Analysts had expected sales of $14.65 billion, according to LSEG. The company said it expects adjusted earnings of $1.50 to $1.54 per share. Analysts were calling for earnings per share of $1.57.
In September, Oracle raised a Fiscal 2026 revenue guidance to $66 billion, which was about $1.5 billion more than analysts expected. In that month, Oracle too name thatits cloud unit would begin taking customer orders for so-called computing clusters originating from more than 131,000 Nvidia “Blackwell” graphics processing units, used for AI model training and related tasks.
As of Monday's close, the stock is up more than 80% this year, making for its best annual performance since 1999.
