Oracle delivered third-quarter earnings that beat analysts’ projections and showed solid growth in its cloud computing business as it shifts from selling conventional software licenses.

The company on Thursday reported total revenue of $9 billion and earnings per share on an adjusted basis of 64 cents. Analysts polled by Thomson Reuters had expected revenue of $9.12 billion and earnings of 62 cents per share.

Oracle’s total cloud revenue in the quarter ended Feb. 29 rose 40% to $735 million. Because the company books overseas sales in foreign currencies, quarterly cloud revenue would have gained 44% measured in constant currency.

Revenue from new software licenses fell 15% to $1.68 billion in the quarter, or 11% lower in constant currency. “We feel very good about the progress of our cloud transition, and clearly customers are rapidly adopting Oracle,” co-CEO Safra Catz said during a conference call.

Oracle shares rose more than 5% to $40.76 in after-hours trading Thursday on the third-quarter report and the company’s announcement that it was adding $10 billion to its existing stock-buyback plan.

Over the past few years, the software giant spent $1.6 billion on capital expenditures, up from $948 million in the year-earlier period, reflecting its investment in capital-intensive data centers necessary to run its cloud business.

Oracle “is often thought of as late to web-based computing on demand. But it has beefed up its cloud offerings lately, and customers have responded with enthusiasm,” the WSJ said.

The two cornerstones of Oracle’s cloud business are known as platform as a service (Paas) and software as a service (SaaS). “In absolute dollar terms, Oracle is already selling more enterprise SaaS … than any other company in the world,” Oracle executive chairman Larry Ellison said in a news release.

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