SAN FRANCISCO (AP) — Oracle joined a recent procession of technology companies that have stumbled in a shaky economy, but management's forecast for the next few months seemed to persuade investors the business software maker will quickly regain its stride.
The quarterly results announced Thursday provided the latest indication that companies and government agencies are clamping down on technology spending until they get a better sense of where the economy is heading.
The decision-makers in technology departments have been especially reluctant to invest in new personal computers and other expensive hardware. That trend has caused leading PC manufacturers such as Hewlett-Packard. Co. and Dell Inc., and a range of microprocessor makers to report disappointing numbers and bleak outlooks.
Oracle's specialty, though, is database software and applications that automate administrative tasks — products that so far are still generating higher sales even in uncertain times. That helped Oracle boost its revenue from new software and online subscriptions by 5 percent from the same time last year, an encouraging sign because those licenses hatch more moneymaking opportunities in the form of future upgrades and maintenance fees.
In a particularly heartening sign, Oracle predicted its sales of software licenses and subscriptions in the current quarter will climb by 5 percent to 15 percent from the same time last year.
But Oracle is also trying to muscle its way into the computer server market, a foray punctuated by its $7.3 billion acquisition of Sun Microsystems in 2010. The expansion hasn't paid off yet, although Oracle executives have pledged it will prove to be a lucrative move. In its most recent quarter, Oracle's hardware revenue plunged 19 percent from the same time last year.
The erosion dragged down Oracle's overall numbers for its fiscal first quarter, a three-month period spanning from June through August. Like many U.S. companies that depend on overseas customers for a lot of their sales, Oracle was hurt by weakened currencies in Europe and other parts of the world. The currency fluctuations translated into fewer dollars during the latest quarter compared to a year ago.