Oracle’s shares rose by as much as 5% during after-hours trading on Monday after the company announced its fiscal fourth-quarter results, which exceeded Wall Street’s expectations. According to Refinitiv, Oracle’s earnings per share stood at $1.67, surpassing analysts’ expectations of $1.58 per share. The company’s revenue also exceeded expectations, reaching $13.84 billion, against an expected $13.73 billion. The statement shows that Oracle’s revenue grew by 17% YoY in the quarter ending on May 31. The company’s net income also rose to $3.32 billion, or $1.19 per share, compared to $3.19 billion or $1.16 per share, in the previous year’s quarter.
Cloud Services and License Support Major Contributor to Oracle’s Revenue
Oracle’s top source of revenue, cloud services and license support, increased by 23% to $9.37 billion. However, revenue from cloud licenses and on-premises declined by 15% to $2.15 billion. The revenue from cloud infrastructure totaled $1.4 billion, increasing by 76%. This rate of growth is faster than that of competitors such as Microsoft and Google, although the company’s cloud infrastructure is still significantly smaller.
U.S. Defense and Intelligence Agencies Approve More Cloud Services
During the quarter, Oracle announced that more of its cloud services had received approval for use by U.S. defense and intelligence agencies. The move may lead to more contracts with these agencies, which could help the company increase its revenue even further.
Stock Performance and Analysts’ Rating
Oracle’s shares have increased by almost 43% this year, excluding the after-hours trading move, while the S&P 500 index has risen by around 13% over the same period. In regular trading, the stock increased by 6%, marking its best day in a year, after analysts at Wolfe Research upgraded the stock to the equivalent of a buy from a hold. The upgrade was based on improving financials and the company’s position in artificial intelligence.
Oracle’s Q4 results exceeded Wall Street’s expectations, with the company’s earnings and revenue beating analysts’ forecasts. The cloud services and license support were the major contributors to the company’s revenue. The revenue from cloud infrastructure grew faster than that of its competitors, although it is still significantly smaller. The approval of more of its cloud services for use by U.S. defense and intelligence agencies may lead to further revenue growth. The company’s stock has performed well this year, and analysts have upgraded the stock to a buy from a hold.
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