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Oracle (ORCL - Free Report) reported third-quarter fiscal 2024 non-GAAP earnings of $1.41 per share, which beat the Zacks Consensus Estimate by 2.92% and increased 15.6% year over year. At constant currency (cc), earnings increased 16% year over year.
Revenues rose 7% (up 7% at cc) year over year to $13.28 billion and beat the Zacks Consensus Estimate by 0.04%.
Oracle jumped 15% in premarket trading as the firm was making progress in its plan to grab a share of the cloud-computing market thanks to its tie-up with AI chip giant NVIDIA Corporation (NVDA - Free Report) .
ORCL's continued investment in cloud infrastructure and innovative solutions like the new Ambulatory Clinic Cloud Application Suite positions the company for sustained growth in the dynamic software industry.
Revenues from the Americas increased 7.8% year over year to $8.27 billion and accounted for 62.3% of total revenues. Europe/Middle East/Africa climbed 8.1% year over year to $3.31 billion and contributed 25% of total revenues. The remaining revenues came from Asia Pacific, which gained 2% year over year to $1.69 billion.
Oracle Corporation Price, Consensus and EPS Surprise
Cloud services and license support revenues increased 12% year over year (11% at cc) to $10 billion, driven by strategic cloud applications, autonomous database and Oracle Cloud Infrastructure (“OCI”).
Cloud license and on-premise license revenues declined 3% year over year (down 3% at cc) to $1.3 billion.
Cloud revenues (IaaS plus SaaS), including Cerner, came in at $5.1 billion, up 25% year over year (24% at cc).
Cloud Infrastructure (IaaS) revenues came in at $1.8 billion, up 49% year over year (49% at cc).
Cloud Application (SaaS) revenues of $3.3 billion increased 14% year over year (14% at cc).
Fusion Cloud ERP (SaaS) revenues came in at $0.8 billion, up 18% year over year (18% at cc). NetSuite Cloud ERP (SaaS) revenues of $0.8 billion increased 21% year over year (20% at cc).
Hardware revenues were $754 million, down 7% year over year (down 7% at cc). Services revenues decreased 5% (down 5% at cc) to $1.3 billion.
Application subscription revenues, which include product support, were $4.6 billion, up 10% year over year. The company’s strategic back-office SaaS applications now have annualized revenues of $7.4 billion and were up 18%.
Infrastructure subscription revenues, which include license support, were $5.4 billion, up 13%. Infrastructure cloud services revenues were up 49%. Excluding legacy hosting services, Gen 2 infrastructure cloud services revenues soared 52%, with annualized revenues of $6.7 billion. OCI consumption revenues surged 63%.
Database subscription revenues, which include database license support, were up 5% and now have annualized revenues of $1.9 billion, driven by cloud database services, which were up 34%.
Operating Details
The non-GAAP total operating expenses increased 3.8% year over year (3% at cc) to $7.48 billion.
The non-GAAP operating income was $5.79 billion, up 15% year over year (up 12% at cc). The non-GAAP operating margin was 43.6%, which expanded 180 basis points on a year-over-year basis.
Balance Sheet & Cash Flow
As of Feb 29, 2023, Oracle had cash & cash equivalents and marketable securities of $9.9 billion compared with $8.69 billion as of Nov 30, 2023.
Operating cash flow and free cash flow amounted to $18.23 billion and $12.25 billion, respectively.
The company’s remaining performance obligation (RPO) is more than $8 billion, with the portion excluding Cerner, which increased 41% at cc. Roughly 43% of total RPO is expected to be recognized as revenues over the next 12 months.
The company repurchased four million shares for a total of $450 million and paid out dividends of $4.4 billion over the last 12 months.
Guidance
For the fourth quarter of fiscal 2024, total revenues, including Cerner, are expected to grow from 4% to 6%. Total revenues, excluding Cerner, are expected to grow in the range of 6-8%. The total cloud revenues, excluding Cerner, are anticipated to grow in the 22-24% band.
The company’s non-GAAP earnings per share are expected between a 2% decline and flat to $1.62-$1.66.
Zacks Rank & Stocks to Consider
Oracle carries a Zacks Rank #3 (Hold). Shares of ORCL have gained 8.3% year to date.
The consensus mark for Meta Platform’s 2024 earnings has been revised upward by 12 cents to $19.94 per share over the past 30 days, indicating a 34.1% increase from 2023. It has a long-term earnings growth expectation of 19.5%. In the trailing 12 months, META stock has rallied 42.9% year to date.
The Zacks Consensus Estimate for Amazon’s 2024 earnings has been revised upward by 2 cents to $4.08 per share in the past seven days, which implies an increase of 40.7% on a year-over-year basis. The long-term expected earnings growth rate for the stock is 28.1%. AMZN stock has returned 15.4% year to date.
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Oracle (ORCL) Q3 Earnings Beat Estimates, Revenues Rise Y/Y
Oracle (ORCL - Free Report) reported third-quarter fiscal 2024 non-GAAP earnings of $1.41 per share, which beat the Zacks Consensus Estimate by 2.92% and increased 15.6% year over year. At constant currency (cc), earnings increased 16% year over year.
Revenues rose 7% (up 7% at cc) year over year to $13.28 billion and beat the Zacks Consensus Estimate by 0.04%.
Oracle jumped 15% in premarket trading as the firm was making progress in its plan to grab a share of the cloud-computing market thanks to its tie-up with AI chip giant NVIDIA Corporation (NVDA - Free Report) .
ORCL's continued investment in cloud infrastructure and innovative solutions like the new Ambulatory Clinic Cloud Application Suite positions the company for sustained growth in the dynamic software industry.
Revenues from the Americas increased 7.8% year over year to $8.27 billion and accounted for 62.3% of total revenues. Europe/Middle East/Africa climbed 8.1% year over year to $3.31 billion and contributed 25% of total revenues. The remaining revenues came from Asia Pacific, which gained 2% year over year to $1.69 billion.
Oracle Corporation Price, Consensus and EPS Surprise
Oracle Corporation price-consensus-eps-surprise-chart | Oracle Corporation Quote
Top-Line Details
Cloud services and license support revenues increased 12% year over year (11% at cc) to $10 billion, driven by strategic cloud applications, autonomous database and Oracle Cloud Infrastructure (“OCI”).
Cloud license and on-premise license revenues declined 3% year over year (down 3% at cc) to $1.3 billion.
Cloud revenues (IaaS plus SaaS), including Cerner, came in at $5.1 billion, up 25% year over year (24% at cc).
Cloud Infrastructure (IaaS) revenues came in at $1.8 billion, up 49% year over year (49% at cc).
Cloud Application (SaaS) revenues of $3.3 billion increased 14% year over year (14% at cc).
Fusion Cloud ERP (SaaS) revenues came in at $0.8 billion, up 18% year over year (18% at cc). NetSuite Cloud ERP (SaaS) revenues of $0.8 billion increased 21% year over year (20% at cc).
Hardware revenues were $754 million, down 7% year over year (down 7% at cc). Services revenues decreased 5% (down 5% at cc) to $1.3 billion.
Application subscription revenues, which include product support, were $4.6 billion, up 10% year over year. The company’s strategic back-office SaaS applications now have annualized revenues of $7.4 billion and were up 18%.
Infrastructure subscription revenues, which include license support, were $5.4 billion, up 13%. Infrastructure cloud services revenues were up 49%. Excluding legacy hosting services, Gen 2 infrastructure cloud services revenues soared 52%, with annualized revenues of $6.7 billion. OCI consumption revenues surged 63%.
Database subscription revenues, which include database license support, were up 5% and now have annualized revenues of $1.9 billion, driven by cloud database services, which were up 34%.
Operating Details
The non-GAAP total operating expenses increased 3.8% year over year (3% at cc) to $7.48 billion.
The non-GAAP operating income was $5.79 billion, up 15% year over year (up 12% at cc). The non-GAAP operating margin was 43.6%, which expanded 180 basis points on a year-over-year basis.
Balance Sheet & Cash Flow
As of Feb 29, 2023, Oracle had cash & cash equivalents and marketable securities of $9.9 billion compared with $8.69 billion as of Nov 30, 2023.
Operating cash flow and free cash flow amounted to $18.23 billion and $12.25 billion, respectively.
The company’s remaining performance obligation (RPO) is more than $8 billion, with the portion excluding Cerner, which increased 41% at cc. Roughly 43% of total RPO is expected to be recognized as revenues over the next 12 months.
The company repurchased four million shares for a total of $450 million and paid out dividends of $4.4 billion over the last 12 months.
Guidance
For the fourth quarter of fiscal 2024, total revenues, including Cerner, are expected to grow from 4% to 6%. Total revenues, excluding Cerner, are expected to grow in the range of 6-8%. The total cloud revenues, excluding Cerner, are anticipated to grow in the 22-24% band.
The company’s non-GAAP earnings per share are expected between a 2% decline and flat to $1.62-$1.66.
Zacks Rank & Stocks to Consider
Oracle carries a Zacks Rank #3 (Hold). Shares of ORCL have gained 8.3% year to date.
Some better-ranked stocks from the broader Computer and Technology sector are Meta Platforms (META - Free Report) and Amazon.com (AMZN - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus mark for Meta Platform’s 2024 earnings has been revised upward by 12 cents to $19.94 per share over the past 30 days, indicating a 34.1% increase from 2023. It has a long-term earnings growth expectation of 19.5%. In the trailing 12 months, META stock has rallied 42.9% year to date.
The Zacks Consensus Estimate for Amazon’s 2024 earnings has been revised upward by 2 cents to $4.08 per share in the past seven days, which implies an increase of 40.7% on a year-over-year basis. The long-term expected earnings growth rate for the stock is 28.1%. AMZN stock has returned 15.4% year to date.