Oracle Sales Decline More Than Expected

17 Sep 2015 | Author: | No comments yet »

Oracle Sales Decline More Than Expected.

Oracle’s sales fell more than expected in the first quarter as a rapid shift by customers to lower-margin cloud-based software failed to make up for waning sales of traditional software.REDWOOD CITY, Calif. – Software maker Oracle said Wednesday its net income dropped 20 percent in its fiscal first quarter on the strong U.S. dollar and rising expenses.Oracle ORCL stock fell 1.7% in after hours trading Wednesday after the company beat analysts’ earnings expectations but fell short on revenue in its first fiscal quarter earnings report. Like its rivals such as SAP, IBM Corp. and Microsoft Corp., Oracle is striving to boost Internet-based software sales to head off fast-growing competitors such as Inc. and Workday Inc.

The Redwood City, California-based company said its sales decreased because of the strong dollar, which makes products priced in dollars relatively expensive when they’re sold overseas and hurts when that foreign revenue is converted back into dollars. The company released its earnings report while the annual Dreamforce conference of rival Salesforce focused on the huge market for cloud-based enterprise services. Cloud-based software sales account for a small portion of Oracles’ total revenue as they are subscription based, which promise a steady stream of revenue but with lower margins.

Oracle expects about 95 per cent of its products will be available on the cloud by October, up from around 65 per cent currently, Co-Chief Executive Mark Hurd told Bloomberg in April.

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