Oracle stock jumps 15% on strong cloud revenue

Oracle Corp.’s push to shift more of its business to the cloud paid off in its fiscal fourth quarter, and its stock was benefiting late Monday. 

The Silicon Valley giant beat the top and bottom line with a sharp bump in cloud-license and on-premise license revenue (up 18% year-over-year to $2.5 billion) and moderate gains in cloud services and license support revenue (up 3% to $7.6 billion).

Oracle 
ORCL,
-4.60%
shares jumped 15% after hours, following a 4.5% decline in the regular session to close at $64.07.

For the fiscal fourth quarter, Oracle reported net income of $3.2 billion, or $1.16 a share, compared with $4 billion, or $1.37 a share, in the year-ago period.

Adjusted earnings, which exclude stock-based compensation expenses and other items, were $1.54 a share.

Revenue rose 5% to $11.8 billion from $11.2 billion in the year-ago quarter.

Analysts surveyed by FactSet had estimated earnings of $1.37 a share on revenue of $11.6 billion.

“We experienced a major increase in demand in our infrastructure cloud business —which grew 39% in constant currency. We believe that this revenue growth spike indicates that our infrastructure business has now entered a hyper-growth phase,” Chief Executive Safra Catz said in a statement.

Oracle did not issue first-quarter guidance in its earnings release. In a conference call with analysts late Monday, Catz offered earnings guidance of between $1.09 and $1.13 a share. Wall Street analysts expect earnings of $1.13 a share on revenue of $10.2 billion during its current August quarter.

“The real story here is the impressive 39% growth in [Oracle’s] cloud infrastructure business, putting its growth more on pace with the market leaders [Amazon.com Inc.’s
AMZN,
-5.45%
] AWS and [Microsoft Corp.’s
MSFT,
-4.24%
] Azure, as well as Google
GOOGL,
-4.29%

GOOG,
-4.08%,
” Daniel Newman, principal analyst at Futurum Research, told MarketWatch.

“Prospects for Oracle continue to look better — even in this tough market for tech, it could be argued Oracle is one of the better bets,” Newman said.

Oracle shares have tumbled 26% so far this year, while the S&P 500 index
SPX,
-3.88%
has sunk 20% in 2022.

You May Also Like

60-40 mix of stocks, bonds on verge of historic gains ‘after being written off’

The traditional portfolio of stocks and bonds has been on a tear…

Wall Street stocks slip after China softens Covid policy

US stocks fell on Wednesday, all but erasing hopes of a festive…

Venture capitalists weigh SVB salvage operation

Venture capital firms are working on a long-shot plan to preserve parts…

CVS seeking to buy Signify Health as part of home-health expansion

CVS Health Corp. is seeking to buy Signify Health Inc., according to people familiar with the matter,…