Customers of Oracle Corp in the hospitality, retail and transportation sectors were forced postpone purchases because of the novel coronavirus pandemic which resulted in the company to report lower than expected revenues for the latest completed quarter. The performance forced the company shares down by 3 per cent after market closure in the United States.
With businesses tightening spending to tackle the economic slump due to the pandemic, clients of the company from industries hit hardest by the pandemic decided to push back on orders. Postponed customer orders were also flagged by rival SAP SE which impacted the annual outlook of the company.
"As the quarter progressed, we saw a drop-off in deals, especially in the industries most affected by the pandemic", Chief Executive Officer Safra Catz said on a post-earnings call.
However, Catz said as countries have started to reopen their economies, many of the deal discussions have already resumed.
However any financial outlook for fiscal 2021 was provided by Oracle whose major portion of revenues is generated from the sale of cloud offerings and software licensing.
In recent times, the company has been pushing hard to get a larger share of the cloud computing market after making a slow start to venture into this segment. For its business cloud computing related united, that includes Oracle Cloud, the company reported revenues from sales of $6.85 billion which missed market estimates of revenues of $6.98 billion.
Headwinds from lower spending by impacted industries such as retail, hospitality and transportation, were probably faced by Oracle's cloud services which resulted in missed revenues of the business unit, said Wedbush analyst Steve Koenig.
There was a 22 per cent drop in the revenues generated by the company from its cloud license and on-premise license unit which came in at $1.96 billion in the quarter, below market estimates of $2.11 billion. This business unit also includes revenues from sales from the licensing of Oracle's software products.
And as some customers were impacted by financial constraints due to the pandemic, the company also faced some issues with delayed payments, Catz said.
There was a 6 per cent drop in the total revenue of the company during the latest completed quarter ended May 31 to reach $10.44 billion which was lower than the expectation of the markets which was at $10.63 billion, according to IBES data from Refinitiv.
On an adjusted basis, the Redwood, California-based company earned $1.20 per share, above expectations of $1.15 per share.
(Source:www.businessworld.com)
With businesses tightening spending to tackle the economic slump due to the pandemic, clients of the company from industries hit hardest by the pandemic decided to push back on orders. Postponed customer orders were also flagged by rival SAP SE which impacted the annual outlook of the company.
"As the quarter progressed, we saw a drop-off in deals, especially in the industries most affected by the pandemic", Chief Executive Officer Safra Catz said on a post-earnings call.
However, Catz said as countries have started to reopen their economies, many of the deal discussions have already resumed.
However any financial outlook for fiscal 2021 was provided by Oracle whose major portion of revenues is generated from the sale of cloud offerings and software licensing.
In recent times, the company has been pushing hard to get a larger share of the cloud computing market after making a slow start to venture into this segment. For its business cloud computing related united, that includes Oracle Cloud, the company reported revenues from sales of $6.85 billion which missed market estimates of revenues of $6.98 billion.
Headwinds from lower spending by impacted industries such as retail, hospitality and transportation, were probably faced by Oracle's cloud services which resulted in missed revenues of the business unit, said Wedbush analyst Steve Koenig.
There was a 22 per cent drop in the revenues generated by the company from its cloud license and on-premise license unit which came in at $1.96 billion in the quarter, below market estimates of $2.11 billion. This business unit also includes revenues from sales from the licensing of Oracle's software products.
And as some customers were impacted by financial constraints due to the pandemic, the company also faced some issues with delayed payments, Catz said.
There was a 6 per cent drop in the total revenue of the company during the latest completed quarter ended May 31 to reach $10.44 billion which was lower than the expectation of the markets which was at $10.63 billion, according to IBES data from Refinitiv.
On an adjusted basis, the Redwood, California-based company earned $1.20 per share, above expectations of $1.15 per share.
(Source:www.businessworld.com)
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