Oracle Stock Sinks On Mixed Q2 Results: The Details
Portfolio Pulse from Ryan Gustafson
Oracle Corporation (NYSE:ORCL) reported Q2 earnings of $1.34 per share, beating estimates by $0.02, but missed revenue expectations with $12.94 billion against the forecasted $13.05 billion. Despite the revenue shortfall, Oracle highlighted a 25% increase in cloud revenue, with cloud infrastructure up 52% and cloud application revenue up 15%. The company's operating cash flow over the last twelve months was $17 billion, and free cash flow was $10.1 billion. CEO Safra Catz emphasized the growing demand for Cloud Infrastructure and Generative AI services, with Remaining Performance Obligations over $65 billion. After the report, ORCL shares dropped 8.91% in after-hours trading to $104.83.
December 11, 2023 | 9:40 pm
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NEGATIVE IMPACT
Oracle's Q2 earnings surpassed expectations, but a slight revenue miss led to an after-hours stock price decline. Strong cloud and AI service growth may bolster future performance.
The immediate negative reaction in after-hours trading is likely due to the revenue miss, despite the earnings beat and strong cloud growth. Investors may be concerned about the revenue trajectory, but the strong performance in cloud and AI services could provide a positive outlook for the company's future growth, potentially mitigating the short-term negative impact.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100