Oracle's software sales disappoint, stock plummets

Thu Jun 20, 2013 6:59pm EDT
 
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By Noel Randewich and Jim Finkle

SAN FRANCISCO (Reuters) - Oracle Corp missed expectations for software sales and subscriptions for the second straight quarter, sending its shares plunging as investors worried CEO Larry Ellison may have trouble getting the technology giant back on track.

On Thursday, Oracle executives forecast that new software sales and subscriptions will rise 0 percent to 8 percent this quarter and blamed weakness in the past quarter on disappointing sales in Asia and Latin America.

Oracle, which is trying to fend off Salesforce.com and other increasingly aggressive rivals focused on providing software over the cloud or Internet, plans to move its stock listing to the New York Stock Exchange in July from the Nasdaq, a major win for the older bourse.

Executives said the move was in shareholders' best interests, without elaborating. Oracle also said it would double its quarterly dividend to 12 cents a share.

"Organic growth is slowing and the company has a lot of pressures it has to deal with. They're late to the cloud and playing catch-up," said Mark Moerdler, an analyst at Bernstein. "Doubling the dividend - they're trying to deliver a message that their ability to deliver significantly more cash to investors is going to continue."

Overall, Oracle's revenue stood unchanged at $10.9 billion in the period, the company's fiscal fourth quarter, ended May 31. That missed the $11.122 billion analysts had expected on average, according to Thomson Reuters I/B/E/S.

More closely watched revenue from new software sales and Internet-based software subscriptions rose 1 percent to $4 billion, short of an average forecast of about $4.2 billion, according to FBR Capital analyst Daniel Ives.

Shares of the software company fell more than 8 percent to $30.46 after hours, after closing down 2.6 percent at $33.21 on the Nasdaq.   Continued...

 
The company logo is shown at the headquarters of Oracle Corporation in Redwood City, California in this February 2, 2010 file photograph. REUTERS/Robert Galbraith/Files