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Oracle Revenues Decline, as Cloud Sputters

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3/14/2019
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REDWOOD SHORES, Calif. -- Oracle Corporation today announced fiscal 2019 Q3 results. Total Revenues were $9.6 billion, down 1% in USD and up 3% in constant currency compared to Q3 last year. Cloud Services and License Support revenues were $6.7 billion, while Cloud License and On-Premise License revenues were $1.3 billion. Total Cloud Services and License Support plus Cloud License and On-Premise License revenues were $7.9 billion, unchanged in USD and up 3% in constant currency.

GAAP Operating Income was up 3% to $3.4 billion and GAAP Operating Margin was 35%. Non-GAAP Operating Income was up 2% to $4.3 billion and non-GAAP Operating Margin was 44%. GAAP Net Income increased to $2.7 billion and non-GAAP Net Income was down 8% to $3.2 billion. GAAP Earnings Per Share increased to $0.76 while non-GAAP Earnings Per Share was up 8% to $0.87.

Short-term deferred revenues were up 1% to $8.0 billion compared to a year ago. Operating Cash Flow was $14.8 billion during the trailing twelve months.

"I'm pleased with Q3 non-GAAP results as revenues grew 3%, operating income increased 5% and EPS grew 12% in constant currency," said Oracle CEO, Safra Catz. "Our overall operating margin improved to 44% as our lower margin hardware business continued to get smaller while our higher margin cloud business continued to get bigger. With year-to-date non-GAAP EPS growth rate now at 16% in constant currency, we will comfortably deliver another year of double-digit EPS growth."

"Our Fusion HCM, ERP, Supply Chain and Manufacturing Cloud applications revenue in total grew 32% in Q3," said Oracle CEO, Mark Hurd. "Our NetSuite ERP Cloud applications also delivered strong results with a revenue growth rate of 30%. That said, let me call your attention to the following approved statement about Oracle's entire applications business from industry analyst IDC."

Per IDC's latest annual market share results, Oracle is the #1 Enterprise Applications vendor in North America based on market share and revenue, surpassing Salesforce.com and SAP.

"The future of Oracle's Cloud Infrastructure business rests upon our highly-secure Gen2 Cloud Infrastructure featuring the world's first and only Autonomous Database," said Oracle CTO, Larry Ellison. "By the end of Q3 we had nearly 1,000 paying Autonomous Database customers and we added around 4,000 new Autonomous Database trials in Q3. It's early days, but this is the most successful introduction of a new product in Oracle's forty year history."

Oracle also announced that its Board of Directors declared a quarterly cash dividend of $0.24 per share of outstanding common stock, reflecting a 26% increase over the current quarterly dividend of $0.19. Larry Ellison, Oracle's Chairman of the Board, Chief Technology Officer and largest stockholder, did not participate in the deliberation or the vote on this matter. This increased dividend will be paid to stockholders of record as of the close of business on April 11, 2019, with a payment date of April 25, 2019.

Oracle

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