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Oracle reverses hardware revenue decline in Q3

oracle-officeOracle’s third-quarter revenue rose 4 percent to US$9.3 billion while net income increased 2 percent to $2.6 billion, buoyed by growth in new software licenses and cloud subscriptions as well as a long-anticipated rise in hardware product revenue.

Hardware systems product sales, which had declined steadily since Oracle’s acquisition of Sun Microsystems, were up 8 percent to $725 million in the quarter ended 28th February, while hardware systems support revenue increased 5 percent to $598 million. New software licenses and cloud subscription revenue rose a combined 4 percent to $2.4 billion.

Software license updates and product support revenue jumped 5 percent to $4.6 billion.

“Oracle Cloud Applications and Engineered Systems are both rapidly growing, billion dollar run-rate businesses,” Oracle chief financial officer Safra Catz said in a statement. The company has focused its marketing efforts on such systems, which include the Exadata database machine, while de-emphasising sales of lower margin commodity servers.

Oracle’s engineered system line is experiencing rapid growth, “while throughout the industry traditional high-end server product lines are in steep decline,” Oracle CEO Larry Ellison said in a statement.

Meanwhile, Oracle’s quarterly cloud application revenue “is now approaching $300 million,” company president Mark Hurd said in a statement. “All of our strategic Cloud Application Suites, including Fusion Enterprise Resource Planning, Fusion Human Capital Management and Fusion Customer Experience, posted triple-digit revenue growth.”

 

Originally published on IDG News Service (Boston Bureau). Click here to read the original story. Reprinted with permission from IDG.net. Story copyright 2017 International Data Group. All rights reserved.
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