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ECT News Community   »   E-Commerce Times Talkback   »   Re: Oracle's Downward Spiral

Re: Oracle's Downward Spiral
Posted by: Laura DiDio 2012-01-05 12:32:54
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Let's be frank: The main reason Oracle's latest quarterly revenues nosedived was backlash from users fed up with two years of price hikes on products, technical support, maintenance and licensing contracts -- and not because of a correction in the overall server hardware market. Yes, it's true that the latest quarterly financials of other high-technology bellwethers like HP, Intel, SAP and Texas Instruments also disappointed.
And yes, it's true that this has spiked fears of widespread weakening in the tech sector.

Re: Oracle's Downward Spiral
Posted by: megankrow 2012-04-19 15:06:36 In reply to: Laura DiDio
New software license sales, a staple of Oracle's bread and butter sales, grew by a paltry 2 percent instead of the double digits Wall Street had anticipated."

The problem with Wall Street is that if they get it wrong the company gets the blame .... this applies to any company, not just Oracle.

"Revenue from software license updates (which boast profit margins of more than 90 percent) rose 9 percent to $4 billion."
............. and this is Oracle's "bread and butter". Oracle still have a solid profit base.

They certainly have problems but given their position in the financial market I have a problem seeing this as much of a "spiral".

downward spiral is a bit over-the-top, don't you think?
Posted by: Huntress_ 2012-01-09 11:45:38 In reply to: Laura DiDio
A few points--the primary point being that a one-quarter earnings miss hardly constitute Oracle entering a downward spiral. More like a hitting a speed-bump. Second point--you raved over the $740M that IBM added from new customers during the first 3 quarters of 2011 yet downplayed the revenues attached to Oracles Exadata. However, assuming that your number is correct regarding exadata being just 5% of total sales, that still constitues approximately $1.4B over the prior 9-month period. Third point--at the time of the last report (quarter ended November 30, 2011), Oracle had only been in the hardware business 22 months (the Sun acquisition being finalized at the end of January 2010). That is simply not enough time to make any type of final judgement about that particular business segment or to determine any meaningful trends--including downward spirals. I do not believe that one poor quarter--especially when it was compared against the same year-ago period which saw 47% growth--constitutes an overall business pattern or a time to panic--especially in light of the macroeconomic backdrop. That said, customer satisfaction is important as are customer defections. Assuming that growing dissatisfaction causing lost business is accurate, it is something Oracle needs to address if it intends to remain relevant in its markets--which I suspect it will find a way to do--even if that means more large transformational acquisitions. JMO.

Fantastic, in-depth commentary
Posted by: MosaicTechnology 2012-01-06 08:20:30 In reply to: Laura DiDio
I think Oracle isn't out of the game, but the new year is a perfect time to make goals to address these growing customer concerns. It was definitely not the best quarter for many of the high tech giants, so hopefully 2012 will bring a better financial climate.

Mosaic Technology
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