Technology

Are Oracle Earnings Good Enough For Investors?

Chris Lange

Published: June 16, 2020 4:17 pm

Last Updated: June 16, 2020 4:20 pm

Oracle Corp. (NYSE: ORCL) released fiscal fourth-quarter financial results after markets closed Tuesday. The firm said that it had $1.20 in earnings per share (EPS) and $10.44 billion in revenue, which compared with consensus estimates of $1.16 in EPS and revenue of $10.67 billion. In the fiscal fourth quarter of last year, the software giant said it had EPS of $1.16 on $11.14 billion in revenue.

Total quarterly revenues were lower by 6%, and down 4% in constant currency, compared to the same period of last year. Cloud Services and License Support revenues totaled $6.8 billion, while Cloud License and On-Premise License revenues were $2.0 billion.

At the same time, short-term deferred revenues were $8.0 billion. Operating cash flow for the trailing 12 months was $13.1 billion.

The board of directors declared a quarterly cash dividend of $0.24 per share of outstanding common stock. This dividend will be paid to stockholders of record as of the close of business on July 15, with a payment date of July 28.

Safra Catz, Oracle’s CEO, commented:

In Q4, non-GAAP earnings per share grew 5% in constant currency driven by strong performances in both our cloud infrastructure and cloud applications businesses. Leading the way was our Fusion Cloud ERP Suite that grew 35% in constant currency, and our Fusion Cloud HCM Suite grew 29% in constant currency. Our overall business did remarkably well considering the pandemic, but our results would have been even better except for customers in the hardest-hit industries that we serve such as hospitality, retail, and transportation postponing some of their purchases. Still, for the third year in a row, we delivered double-digit constant currency earnings per share growth in FY20.

Oracle stock closed Tuesday at $54.68, in a 52-week range of $39.71 to $60.50. The consensus price target is $51.12. Following the announcement, the stock was down over 3% at $52.70 in the after-hours session.