Oracle's revenue failed to meet expectations for three operating segments, resulting in a decline in the stock's price after-hours.
Shares of Oracle declined more than 9% in after-hours trading on Monday following the software firm's report of second-quarter revenue and guidance that fell short of Wall Street prognostications. For the quarter that ended November 30, the company's EPS was $1.34, above the anticipated $1.32, while its revenue came in at $12.94 billion, not meeting the expected $13.05 billion figure. Net income was reported at $2.5 billion, a 44% rise from the prior year. Oracle forecasted their third quarter adjusted net income to be between $1.35 to $1.39 per share and revenue growth to range from 6-8%, while analysts had forecasted $1.37 per share and $13.34 billion in revenue.
Out of the $9.64 billion in revenue from cloud services and license support, the Street Account consensus was at $9.71 billion, with the services revenue missing the estimated $1.40 billion figure too. Vying for customers like Elon Musk's xAI, Halliburton and Samsung, the company said that the demand for AI chips was higher than what Oracle was able to supply. As Oracle's cloud infrastructure made $1.6 billion in the quarter, up 52%, the company is planning to connect 20 data centers with Azure in the coming months. Oracle's NetSuite division also purchased Next Technik, an Australian field service software manufacturer.
Over the course of the year, Oracle shares have seen an improvement of 41%, higher than the S&P 500's 20% growth.
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