ORACLE REPORTS Q1 GAAP EPS OF 22 CENTS UP 8%, NON-GAAP EPS OF 30 CENTS UP 3%
Operating Margins Up Over 500 Basis Points
Redwood Shores, CA – September 16, 2009
Oracle Corporation (NASDAQ: ORCL) today announced fiscal 2010 Q1 GAAP earnings per share were $0.22 up 8% compared to last year. First quarter GAAP total revenues were down 5% to $5.1 billion, while quarterly GAAP net income was up 4% to $1.1 billion. GAAP new software license revenues were down 17% to $1.0 billion. GAAP software license updates and product support revenues were up 6% to $3.1 billion. GAAP operating income was up 14% to $1.7 billion and GAAP operating margin was up 590 basis points to 34%. GAAP operating cash flow on a trailing twelve-month basis was $8.8 billion, up 10%.
First quarter non-GAAP earnings per share were up 3% to $0.30. Non-GAAP total revenues were down 7% to $5.1 billion, while non-GAAP net income was flat at $1.5 billion, compared to the same quarter last year. Non-GAAP operating income was up 7% to $2.3 billion and non-GAAP operating margin was up 570 basis points to 46%.
Oracle’s results were impacted by the reduced value of foreign currencies when compared to US dollars, reducing Q1 GAAP earnings by $0.02 per share. Without this impact, Oracle’s Q1 GAAP and non-GAAP earnings per share would have been $0.24 and $0.32, respectively. GAAP and non-GAAP new software license revenues would have been down 14%, and our software license updates and product support revenues would have been up 11% on a GAAP basis and up 8% on a non-GAAP basis. GAAP and non-GAAP operating income would have been up 21% and 11%, respectively.
In addition, Oracle’s Board of Directors declared a cash dividend of $0.05 per share of outstanding common stock to be paid to stockholders of record as of the close of business on October 14, 2009, with a payment date of November 4, 2009. Future declarations of quarterly dividends and the establishment of future record and payment dates are subject to the final determination of Oracle’s Board of Directors.
“Yesterday, Sun and Oracle announced Exadata Version 2, which is twice as fast as Exadata Version 1 for data warehousing and the first and only database machine that runs online transaction processing – OLTP – applications,” said Oracle CEO Larry Ellison. “This new combination of Sun hardware and Oracle software is now the world’s fastest computer system for both OLTP and data warehousing.”
“By substantially improving operating margins we were able to increase Q1 earnings per share even though revenues decreased slightly,” said Safra Catz, Oracle’s President. “We grew non-GAAP operating margins by 570 basis points to 46 percent in our seasonally smallest quarter. Our operating model continues to drive earnings for our stockholders.”
“Software license updates and product support revenues grew 11%, to $3.1 billion, for the quarter when adjusted for the change in the US dollar since last year,” said Oracle Executive Vice President and CFO, Jeff Epstein. “This growth, coupled with our disciplined expense management, was key to our ability to generate a record $8.5 billion in free cash flow over the last twelve months.”
“We grew faster than SAP in every region around the world, including Europe, where our applications business grew 3 percent in constant currency versus negative 39 percent for SAP’s most recent quarter,” said Oracle President Charles Phillips. “Our applications team also executed especially well in North America, where our applications business grew 8 percent in constant currency versus negative 50 percent for SAP.”
Q1 Earnings Conference Call and Webcast
Oracle will hold a conference call and web broadcast today to discuss these results at 2:00 p.m. (PDT) / 5:00 p.m. (EDT). You may listen to the call by dialing (866) 423-8620 or (719) 387-4093, Passcode: 745867. To access the live web broadcast of this event, please visit the Oracle Investor Relations website at http://www.oracle.com/investor.
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"Safe Harbor" Statement: Statements in this press release relating to Oracle's or its Board of Directors’ future plans, intentions and prospects are "forward-looking statements" and are subject to material risks and uncertainties. Many factors could affect our current expectations and our actual results, and could cause actual results to differ materially. We presently consider the following to be among the important factors that could cause actual results to differ materially from expectations: (1) Economic, political and market conditions, including the recent global economic and financial crisis, could adversely affect our business, operating results or financial condition, including our revenue growth and profitability, through reductions in customer IT budgets and expenditures and through the general tightening of access to credit. (2) We may fail to achieve our financial forecasts due to such factors as delays or size reductions in
transactions, fewer large transactions in a particular quarter, unanticipated fluctuations in currency exchange rates, delays in delivery of new products or releases or a decline in our renewal rates for software license updates and product support. (3) We cannot assure market acceptance of new products or services or new versions of existing or acquired products or services. (4) We have an active acquisition program and our acquisitions may not be successful,
may involve unanticipated costs or other integration issues or may disrupt our existing operations. (5) Our international sales and operations subject us to additional risks that can adversely affect our operating results, including risks relating to foreign currency gains and losses and risks relating to compliance with international and U.S. laws that apply to our international operations. (6) Intense competitive forces demand rapid technological advances and frequent new product introductions and could require us to reduce prices or cause us to lose customers. A detailed discussion of these factors and other risks that affect our business is contained in our SEC filings, including our most recent reports on Form 10-K and Form 10-Q, particularly under the heading "Risk Factors." Copies of these filings are available online from the SEC or by contacting Oracle Corporation's Investor Relations Department at (650) 506-4073 or by clicking on SEC Filings on Oracle’s Investor Relations website at http://www.oracle.com/investor. All information set forth in this release is current as of September 16, 2009. Oracle undertakes no duty to update any statement in light of new information or future events.