Friday, March 26, 2010

$ORCL – commentary from the conf call -

·         ORCL - EPS came in 0.38 non-gaap = inline w/the St; total licenses came in up 10% ex sun it looks like = better than the St's up MSD %; looks like DB licenses came in +11% vs. St up ~5%; apps came in much stronger than expected at +21% for licenses (the St was looking for 5% growth).  Total revs came in $6.469B vs. St $6.348B.  "The Sun integration is going even better than we expected," said Oracle President, Safra Catz. "We believe that Sun will make a significant contribution to our fourth quarter earnings per share as well as meet the profitability goals we set for next year."; "Exadata is the fastest growing product in Oracle's history," said Oracle President, Charles Phillips. "Introduced a little over a year ago, the Exadata pipeline is now approaching $400 million with Q4 bookings forecast at nearly $100 million. This strengthens both sales growth and profitability in our Sun server and storage businesses." 

·         ORCL – commentary from the conf call - Ex Sun, FX benefit was less than guidance by 200bp.  Even w/FX being less than anticipated, they still beat guidance.  Total revenues excluding sun were at the high end of our guidance range even without the full benefit of currency.  tax rate for the third quarter was 25.9% as we saw some one-time benefits to our tax rate.  New software license revenues were up 13% and up 10% excluding Sun.  This 10% growth beat the high end of our guidance range calling for 9% growth.  Applications new license revenues were 477 million up 21% from last year.  Says apps doing well in all regions and all verticals.  Apps were much better than anticipated.  Op margins came in very strong – w/Sun, op margin came in 45%.  Sun’s revs came in $596MM, which was “far better than expected” (the Sun revs were only for the month of Feb).  Mgmt thinks Sun deal off to a strong start.  They continue to see Sun kicking in $1.5B in F11 op income and $2B to F12.  they are changing sales incentives to margins vs. sales volumes.  Guidance (which includes Sun); they think guidance is conservative; they say pipeline is very strong for software and hardware; they assume close rates below normal; expects 3% pos. FX impact on licenses and ~4% impact on total revs.  FQ4 guidance: new licenses +3-13% headline and flat-to-up 10% CC; Total revenue growth on a non-GAAP basis is expected to range from 36% to 41% at current exchange rates and 32% to 37% in constant currency. On a GAAP basis we expect total revenue from 35-40% at current exchange rates and 31-36% in constant currency. Non-GAAP EPS is expected to be 52-56 cents assuming current exchange rates up from 46 cents last year and from 50-54 cents in constant currency.  Says they will deliver Fusion application suite during this calendar year

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