But all is not gloom and doom for Oracle. Excerpts from Chuck Phillips of Morgan
Stanley on the last quarter....
It's useful to keep the quarter in perspective.
It's a miss but not a financial disaster:
- Oracle made $900 million in operating profits in the quarter. This is
real business.
- Revenue of $2.67 billion was 5% below our $2.75 billion estimate --
not 25% below like some other pre-announcements.
- The company booked $1.1 billion in license revenue instead of our $1.2
billion estimate -- so most deals closed.
- Applications were up 50% in the quarter. Database was flat to
slightly down in the quarter versus a tough compare. Total licenses
increased 6%.
Oracle was one of the last generals left standing on a brittle
technology battlefield, and in the end couldn't avoid the bullets and hand grenades
that were showering down from above. It has become clear that in an environment
like this one, there are no bulletproof vests. Other software companies have to be
concerned and will likely see something in March. Oracle has a strong product line,
is well established with customers references and couldn't get quite enough deals
done. Most other software companies are in far weaker positions from a product and
positioning perspective.
>>> [EMAIL PROTECTED] 03/21/01 01:52PM >>>
------- Forwarded message follows -------
Date sent: Mon, 19 Mar 2001 02:04:08 -0500 (EST)
...
***************************************************
$1 Billion Savings Gets Even Less Likely For Oracle
Oracle's goal to reach one billion dollars in savings by implementing
its own financial software just got even more unattainable. Oracle
Thursday announced financial results for the third quarter, ending
Feb. 28. As expected, the company failed to meet the margins and
profits it will need to achieve its savings goals,
The operating margin for the third quarter was 33 percent. That's up
2 percent year-over-year, which is good, but it falls far short of
the 40 percent margin that the company and financial analysts have
said would be needed to achieve the company's goal of saving 1
billion in costs this year over last year.
Combine the disappointing operating margin with flat, rather than
growing, profits and what you end up with is a cost savings, year-
over-year, significantly less than even the $300 million that it
seemed was just barely within Oracle's reach two weeks ago. -- Mitch
Wagner
Read the entire story:
http://update.internetweek.com/cgi-bin4/flo?y=eC2a0BdpN70V30LxJk
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