Company buys back $10 billion in stock over quarter
Oracle Corp. shares rose in the extended session Monday after the enterprise software company’s quarterly results narrowly topped Wall Street estimates and forecast earnings roughly in-line with analysts’ consensus.
Oracle ORCL, +5.18% shares rose 5.1% after hours, following a 1.9% decline to close the regular session at $45.73. In comparison, both the Dow Jones Industrial Average DJIA, -2.11% and the S&P 500 index SPX, -2.08% finished Monday down 2.1%, while the tech-heavy Nasdaq Composite Index COMP, -2.27% fell 2.3%.
On Monday’s earnings conference call, Co-Chief Executive Safra Catz forecast adjusted earnings of 83 cents to 85 cents a share for the fiscal third quarter, while analysts expect 84 cents a share.
Catz also said Oracle repurchased 203 million shares over the past quarter for $10 billion, for an average $49.26 a share. When the quarter started, shares were trading at $47.68 and reached a high of $52.11 during the quarter on Sept. 26.
Catz said Oracle reduced its number of outstanding shares by 602 million, or more than 12%, over the past 12 months.
The company reported fiscal second-quarter net income of $2.33 billion, or 61 cents a share, compared with $2.21 billion, or 52 cents a share, in the year-ago period. Adjusted earnings were 80 cents a share. Of analysts surveyed by FactSet, Oracle was expected to post adjusted earnings of 78 cents a share on average, while Oracle had forecast 78 cents to 80 cents a share.
Revenue declined to $9.56 billion from $9.59 billion in the year-ago quarter; Wall Street had expected $9.52 billion from Oracle, according to analysts polled by FactSet.
Cloud services and license support revenue rose to $6.64 billion from $6.46 billion in the year-ago period, while analysts surveyed by FactSet were looking for $6.63 billion. Cloud license and on-premise license revenue declined to $1.22 billion from $1.33 billion in the year-ago period, while analysts were looking for $1.19 billion.
Cloud growth has been the biggest concern for investors for the past year, which has seen Oracle stock decline 9.4%. The S&P 500 index has declined 2.8% in that time.
Of the 37 analysts who cover Oracle, 17 have buy or overweight ratings, 19 have hold ratings and one has a sell rating, with an average price target of $52.83.