Oracle Q2 Profit Drops On Strong US Dollar

(RTTNews) - Business software giant Oracle Corp. (ORCL) Wednesday reported a drop in profit for the second quarter, as revenues declined reflecting strong U.S. dollar. Earnings for the quarter trumped Wall Street estimates, while revenues fell short of expectations.

Redwood Shores, California-based Oracle's second-quarter profit dropped to $2.20 billion or $0.51 per share from $2.50 billion or $0.56 per share last year.

Adjusted earnings for the quarter dropped to $0.63 per share from $0.69 per share last year. Analysts polled by Thomson Reuters expected earnings of $0.60 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter dropped 6 percent to $8.99 billion from $9.60 billion last year. Analysts had a consensus revenue estimate of $9.06 billion for the quarter.

Oracle noted that strong U.S. dollar impacted its earnings per share by $0.05, while revenues were flat on a constant currency basis.

Oracle' revenue growth has slowed down in the last few quarters, raising investor concern about the company's ability to transition from its traditional approach of licensing software to the so called cloud computing method.

Oracle's total cloud and On-Premise software revenues fell 4 percent year-over-year to $7.00 billion, while hardware revenues slipped 16 percent to $1.12 billion. Total services revenues dropped 8 percent to $861 million.

Further, the company declared a quarterly dividend of $0.15 per share, payable on January 27 for shareholders as of January 6.

ORCL closed Wednesday's trading at $38.91, up $0.70 or 1.83%, on the Nasdaq. The stock further rose $0.70 or 1.80% in the after-hours trade.