Get all your news in one place.
100’s of premium titles.
One app.
Start reading
The Street
The Street
Business
Martin Baccardax

Oracle Stock Holds Firm As Cerner Lifts Q1 Cloud Sales, Adds To Solid 2023 Outlook

Oracle Corp. (ORCL) shares moved only modestly lower Tuesday after the cloud-focused software group posted weaker-than-expected first quarter earnings but forecast solid near-term revenues.

Oracle said the impact of its $28 billion purchase of Cenrer (CERN), the second-largest designer of software used by doctors and hospitals to mange and store medical records, added heft to the group's overall bottom line, which came in at $1.03 per share. But for an 8 cent headwind from the surging dollar -- compared to a guide of around 5 cents -- that would have topped the Street consensus forecast of $1.07 per share.

Group revenues were firm at $11.45 billion, rising 17% from last year and matching analysts' estimates, with cloud services sales rising 14% from last year to $8.42 billion. Cloud revenues were up an impressive 50% to $3.6 billion, including Cerner's contribution of around $1.4 billion. 

Oracle is forecasting constant currency revenue growth of between 21% and 23% for the current three month period, with CEO Safra Catz noting that "total cloud growth for the fiscal year, excluding Cerner, will be above 30% in constant currency."

Dollar headwinds will persist, however, trimming 7 cents from the group's bottom line.

"We have so much company-specific or product-specific momentum that as customers discover us, use us, give us a chance, they become honestly overwhelmed by our capabilities and how much less expensive, more flexible, more secure, and how differently we're architected such that we're also more sustainable for them," CEO Catz told investors on a conference call late Monday. 

"We continue to get excellent returns on the investments we've been making over the last few years in products, infrastructure, and our sales organization," he added. "We are seeing company-specific and product-specific momentum. We continue to expect organic revenue growth in our cloud business will accelerate substantially in FY '23."

Oracle shares were marked 0.21% lower in early Tuesday trading, compared to a 3.3% decline for the Nasdaq Composite benchmark, to change hands at  $76.92 each.

Sign up to read this article
Read news from 100’s of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
Our Picks
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.