Company credits cloud software, turnkey solutions with results

Oracle Corp. scored a net profit of US$2.6 billion on revenues of $9.3 billion for the three-month period ending Feb. 28, a two per cent increase over the same period a year ago.

The company reported Tuesday that in its fiscal third quarter new software licenses and cloud software subscriptions revenues were up four per cent over the year ago period to $2.4 billion (all numbers US currency), software license updates and product support revenues were up five per cent to $4.6 billion, and hardware systems products revenues were up eight per cent to $725 million.

“In constant currency, our cloud software subscriptions revenues grew 25 per cent and our engineered systems revenue grew more than 30 per cent in the quarter,” Oracle president and CFO Safra Catz said in a statement.

“Oracle cloud applications and engineered systems are both rapidly growing, billion dollar run-rate businesses. Those two high-growth businesses helped us deliver record year-to-date operating cash flow, and a record $15 billion of operating cash flow over the past 12 months.”

Engineered systems are pre-integrated server/storage/software packages including the Exadata Database Machine, Oracle Database Appliance and the Exalogic Elastic Cloud.

“Our engineered systems business is growing rapidly for the same fundamental reason that our cloud applications business is growing rapidly. In both cases, customers want us to integrate the hardware and software and make it work together, so they don’t have to,” CEO Larry Ellison said in a statement.
Although hardware sales are growing software licences, updates, product support and cloud subscriptions accounted for 75 per cent of revenues during the quarter.

Oracle president Mark Hurd noted that sales of Oracle’s cloud applications accelerated sharply in the quarter with bookings growth of over 60 per cent, with quarterly revenue approaching $300 million. Cloud application suites include Fusion Enterprise Resource Planning, Fusion Human Capital Management and Fusion Customer Experience.

For the nine months ending Feb. 28 Oracle [Nasdaq: ORCL] had net profit of $7.3 billion on revenue of just under $27 billion.

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