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Oracle (ORCL) International Revenue Performance Explored

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Have you evaluated the performance of Oracle's (ORCL - Free Report) international operations for the quarter ending May 2024? Given the extensive global presence of this software maker, analyzing the patterns in international revenues is crucial for understanding its financial strength and potential for growth.

In the current era of a tightly interconnected global economy, the proficiency of a company to penetrate international markets significantly influences its financial health and trajectory of growth. For investors, the key is to grasp how reliant a company is on overseas markets, as this provides insights into the durability of its earnings, its ability to exploit different economic cycles, and its overall growth capabilities.

Being present in international markets serves as a counterbalance to domestic economic challenges while offering chances to engage with more rapidly evolving economies. However, this kind of diversification introduces challenges like currency fluctuations, geopolitical uncertainties and varying market trends.

Upon examining ORCL's recent quarterly performance, we noticed several interesting patterns in the revenue generated from its international segments, which are commonly analyzed and observed by Wall Street experts.

The company's total revenue for the quarter amounted to $14.29 billion, marking an increase of 3.3% from the year-ago quarter. We will next turn our attention to dissecting ORCL's international revenue to get a clearer picture of how significant its operations are outside its main base.

Exploring ORCL's International Revenue Patterns

Europe, Middle East and Africa generated $3.54 billion in revenues for the company in the last quarter, constituting 24.8% of the total. This represented a surprise of -1.72% compared to the $3.6 billion projected by Wall Street analysts. Comparatively, in the previous quarter, Europe, Middle East and Africa accounted for $3.32 billion (25%), and in the year-ago quarter, it contributed $3.46 billion (25%) to the total revenue.

Asia-Pacific accounted for 12.6% of the company's total revenue during the quarter, translating to $1.8 billion. Revenues from this region represented a surprise of -3.41%, with Wall Street analysts collectively expecting $1.87 billion. When compared to the preceding quarter and the same quarter in the previous year, Asia-Pacific contributed $1.69 billion (12.8%) and $1.8 billion (13%) to the total revenue, respectively.

Prospective Revenues in International Markets

It is projected by analysts on Wall Street that Oracle will post revenues of $13.24 billion for the ongoing fiscal quarter, an increase of 6.3% from the year-ago quarter. The expected contributions from Europe, Middle East and Africa and Asia-Pacific to this revenue are 24.8% and 12.9%, translating into $3.29 billion and $1.7 billion, respectively.

For the full year, the company is projected to achieve a total revenue of $57.74 billion, which signifies a rise of 9% from the last year. The share of this revenue from various regions is expected to be: Europe, Middle East and Africa at 24.6% ($14.19 billion) and Asia-Pacific at 12.7% ($7.34 billion).

The Bottom Line

Oracle's leaning on foreign markets for its revenue stream presents a mix of chances and challenges. Therefore, a vigilant watch on its international revenue movements can greatly aid in projecting the company's future direction.

In a world where international interdependencies and geopolitical conflicts are ever-increasing, Wall Street analysts closely monitor these trends for companies having international presence to adjust their earnings forecasts. Of course, there are several other factors, including a company's standing within its home borders, that influence analysts' earnings forecasts.

We at Zacks strongly focus on the dynamic earnings forecast of companies, given that empirical studies have demonstrated its potent impact on the immediate price movement of stocks. Invariably, there's a positive relationship -- upward earnings predictions often result in an increase in stock prices.

The Zacks Rank, our proprietary stock rating mechanism, demonstrates a notable performance history confirmed through external audits. It effectively utilizes the power of earnings estimate revisions to act as a predictor of a stock's price performance in the near term.

Oracle, bearing a Zacks Rank #3 (Hold), is expected to mirror the broader market's movements in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

A Review of Oracle's Recent Stock Market Performance

Over the past month, the stock has seen an increase of 11.9% in its value, whereas the Zacks S&P 500 composite has posted an increase of 3.7%. The Zacks Computer and Technology sector, Oracle's industry group, has descended 3.1% over the identical span. In the past three months, there's been an increase of 8.1% in the company's stock price, against a rise of 5.7% in the S&P 500 index. The broader sector has declined by 1% during this interval.

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