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What to Expect Ahead of Oracle's (ORCL) Q3 Earnings?
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Oracle (ORCL - Free Report) is scheduled to release third-quarter fiscal 2022 results on Mar 10.
Oracle expects non-GAAP earnings growth rate on a year-over-year basis in the range of 2-6% at cc and in the band of $1.19-$1.23 per share.
The Zacks Consensus Estimate for earnings has been stable in the past 30 days at $1.17 per share, suggesting growth of 0.86% from the year-ago quarter’s reported figure.
For third-quarter fiscal 2022, Oracle expects a total revenue growth rate on a year-over-year basis in the range of 3-5% at USD and 6-8% at cc.
The Zacks Consensus Estimate is pegged at $10.51 billion, indicating an increase of 4.21% on a year-over-year basis.
The company has a trailing four-quarter earnings surprise of 9.32%, on average.
Accelerated digital transformation along with the continuation of remote work and mainstream adoption of hybrid/flexible work model is likely to have driven demand for Oracle Cloud Infrastructure (OCI) services and the company’s other cloud-based applications.
In the last reported quarter, Oracle’s Cloud services and license support revenues (73% of total revenues) increased 6% year over year (up 6% at cc) to $7.554 billion.
Strength in Oracle’s software-as-a-service (SaaS), infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS) products are likely to have favored revenue performance. In the last reported quarter, management noted that the company’s IaaS and SaaS business revenues on an annualized basis stood at $10.7 billion and were up 22%.
Continued momentum in back-office cloud-based Fusion Human Capital Management (“HCM”) solutions along with NetSuite Enterprise Resource Planning (“ERP”) and Fusion ERP applications is expected to have favored ORCL’s quarterly performance.
The migration of several large-scale SAP clients to Oracle Fusion ERP cloud and increasing deal wins in several verticals, especially banking and healthcare, might have acted as a tailwind for the company’s ERP business.
NetSuite ERP and Fusion ERP cloud revenues were up 29% and 35%, respectively, in the third quarter of fiscal 2022.
The robust adoption of Oracle’s next-generation autonomous database and Oracle Dedicated Region Cloud, supported by machine learning (ML) and Artificial Intelligence (AI) capabilities, might have benefited the top line. Autonomous database in Gen2 public cloud infrastructure is witnessing healthy traction.
Oracle’s latest Exadata Cloud@Customer service offering is gaining considerable traction among on-premises clients. Higher customer acquisitions, including independent software vendors (ISVs), is likely to have positively contributed to the top line.
Strength in the Oracle Fusion Cloud Supply Chain & Manufacturing (SCM) solution, integrated with new capabilities that help companies foster innovation and improve decision making, is expected to contribute to the top line in the about-to-be-reported quarter.
Higher expenses on product development, especially increased investment toward cloud platform, might have dented fiscal third-quarter performance. Intense competition in the cloud computing market from the likes of Amazon Web Services, Azure platform and Google Cloud might also have limited margin expansion.
Q3 Highlights
In the to-be-reported quarter, Oracle Fusion Cloud Enterprise Palnning (ERP) and Oracle Fusion Cloud Supply Chain & Management have been chosen by India’s premier communications solutions provider, Bharti Airtel, to digitize and simplify finance, planning and supply chain processes.
In February 2022, Oracle and Telefonica’s (TEF - Free Report) Telefonica Tech entered into an agreement to jointly offer cloud platform-as-a-service and applications to enterprises and public sector organizations across Telefonica Tech’s customer base.
Per the agreement, the services will be delivered via a global partnership, enabling Telefonica Tech to offer Oracle Cloud Infrastructure (OCI) services as part of its portfolio, while simultaneously supporting clients through professional and managed services.
Oracle also announced new logistics management capabilities within Oracle Supply Chain & Manufacturing to help organizations improve efficiency and value across their global supply chains.
In February, Oracle and Red Bull Racing enhanced their existing partnership by introducing a new Team name, Oracle Red Bull Racing, as well as the Team’s new car for the upcoming season, the RB18.
In December 2021, Oracle announced an agreement to acquire Cerner Corporation in an all-cash transaction amounting to $28.3 billion or $95 per share.
The acquisition is expected to bolster the company’s position in the lucrative healthcare domain. Cerner and Oracle have the capacity to transform healthcare delivery by providing medical professionals with better information, thus enabling them to make better treatment decisions and generate better patient outcomes
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Oracle this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here.
Oracle has an Earnings ESP of +0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
A Stock to Consider
Here is a stock you may want to consider, as our model shows that it has the right combination of elements to post an earnings beat in its upcoming release:
CLVT is down 38.4% in the past year against the Zacks Internet - Software industry’s decline of 46.5% and the Computer and Technology sector’s rise of 5% in the past year.
Image: Bigstock
What to Expect Ahead of Oracle's (ORCL) Q3 Earnings?
Oracle (ORCL - Free Report) is scheduled to release third-quarter fiscal 2022 results on Mar 10.
Oracle expects non-GAAP earnings growth rate on a year-over-year basis in the range of 2-6% at cc and in the band of $1.19-$1.23 per share.
The Zacks Consensus Estimate for earnings has been stable in the past 30 days at $1.17 per share, suggesting growth of 0.86% from the year-ago quarter’s reported figure.
For third-quarter fiscal 2022, Oracle expects a total revenue growth rate on a year-over-year basis in the range of 3-5% at USD and 6-8% at cc.
The Zacks Consensus Estimate is pegged at $10.51 billion, indicating an increase of 4.21% on a year-over-year basis.
The company has a trailing four-quarter earnings surprise of 9.32%, on average.
Oracle Corporation Price and EPS Surprise
Oracle Corporation price-eps-surprise | Oracle Corporation Quote
Factors to Consider
Accelerated digital transformation along with the continuation of remote work and mainstream adoption of hybrid/flexible work model is likely to have driven demand for Oracle Cloud Infrastructure (OCI) services and the company’s other cloud-based applications.
In the last reported quarter, Oracle’s Cloud services and license support revenues (73% of total revenues) increased 6% year over year (up 6% at cc) to $7.554 billion.
Strength in Oracle’s software-as-a-service (SaaS), infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS) products are likely to have favored revenue performance. In the last reported quarter, management noted that the company’s IaaS and SaaS business revenues on an annualized basis stood at $10.7 billion and were up 22%.
Continued momentum in back-office cloud-based Fusion Human Capital Management (“HCM”) solutions along with NetSuite Enterprise Resource Planning (“ERP”) and Fusion ERP applications is expected to have favored ORCL’s quarterly performance.
The migration of several large-scale SAP clients to Oracle Fusion ERP cloud and increasing deal wins in several verticals, especially banking and healthcare, might have acted as a tailwind for the company’s ERP business.
NetSuite ERP and Fusion ERP cloud revenues were up 29% and 35%, respectively, in the third quarter of fiscal 2022.
The robust adoption of Oracle’s next-generation autonomous database and Oracle Dedicated Region Cloud, supported by machine learning (ML) and Artificial Intelligence (AI) capabilities, might have benefited the top line. Autonomous database in Gen2 public cloud infrastructure is witnessing healthy traction.
Oracle’s latest Exadata Cloud@Customer service offering is gaining considerable traction among on-premises clients. Higher customer acquisitions, including independent software vendors (ISVs), is likely to have positively contributed to the top line.
Strength in the Oracle Fusion Cloud Supply Chain & Manufacturing (SCM) solution, integrated with new capabilities that help companies foster innovation and improve decision making, is expected to contribute to the top line in the about-to-be-reported quarter.
Higher expenses on product development, especially increased investment toward cloud platform, might have dented fiscal third-quarter performance. Intense competition in the cloud computing market from the likes of Amazon Web Services, Azure platform and Google Cloud might also have limited margin expansion.
Q3 Highlights
In the to-be-reported quarter, Oracle Fusion Cloud Enterprise Palnning (ERP) and Oracle Fusion Cloud Supply Chain & Management have been chosen by India’s premier communications solutions provider, Bharti Airtel, to digitize and simplify finance, planning and supply chain processes.
In February 2022, Oracle and Telefonica’s (TEF - Free Report) Telefonica Tech entered into an agreement to jointly offer cloud platform-as-a-service and applications to enterprises and public sector organizations across Telefonica Tech’s customer base.
Per the agreement, the services will be delivered via a global partnership, enabling Telefonica Tech to offer Oracle Cloud Infrastructure (OCI) services as part of its portfolio, while simultaneously supporting clients through professional and managed services.
Oracle also announced new logistics management capabilities within Oracle Supply Chain & Manufacturing to help organizations improve efficiency and value across their global supply chains.
In February, Oracle and Red Bull Racing enhanced their existing partnership by introducing a new Team name, Oracle Red Bull Racing, as well as the Team’s new car for the upcoming season, the RB18.
In December 2021, Oracle announced an agreement to acquire Cerner Corporation in an all-cash transaction amounting to $28.3 billion or $95 per share.
The acquisition is expected to bolster the company’s position in the lucrative healthcare domain. Cerner and Oracle have the capacity to transform healthcare delivery by providing medical professionals with better information, thus enabling them to make better treatment decisions and generate better patient outcomes
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Oracle this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here.
Oracle has an Earnings ESP of +0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
A Stock to Consider
Here is a stock you may want to consider, as our model shows that it has the right combination of elements to post an earnings beat in its upcoming release:
Clarivate (CLVT - Free Report) has an Earnings ESP of +4.57% and a Zacks Rank #2. The company is set to announce fourth-quarter 2021 results on Mar 10. You can see the complete list of today’s Zacks #1 Rank stocks here.
CLVT is down 38.4% in the past year against the Zacks Internet - Software industry’s decline of 46.5% and the Computer and Technology sector’s rise of 5% in the past year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.