Oracle (ORCL) earnings Q3 2020

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Oracle CEO Safra Catz delivers a keynote address during the 2019 Oracle OpenWorld on September 17, 2019 in San Francisco, California. Oracle CEO Safra Catz kicked off day two of the 2019 Oracle OpenWorld with a keynote address. The annual convention runs through September 19.

Justin Sullivan | Getty Images

Oracle shares rose as much as 5% Thursday after hours, partly reversing an 11% drop during the day’s trading session, as the company reported fiscal third-quarter earnings that were better than analysts had expected.

Here’s how the company did:

  • Earnings: 97 cents per share, adjusted, vs. 96 cents per share as expected by analysts polled by Refinitiv.
  • Revenue: $9.80 billion, vs. $9.75 billion as expected by analysts polled by Refinitiv.

The company’s revenue grew 2% on an annualized basis in the quarter, which ended on February 29, according to a statement. 

Revenue from Oracle’s top business segment, cloud services and license support, totaled $6.93 billion, growing 4% year over year and coming in above the FactSet consensus estimate of $6.90 billion.

The cloud license and on-premises license segment contributed $1.23 billion in revenue, which is down 2% and more than the $1.19 billion FactSet consensus estimate.

The company’s hardware and services divisions missed expectations. Hardware had $857 million in revenue, down 6% in the quarter, while the FactSet consensus was $878 million. The company had $778 million in services revenue, down 1%; the FactSet consensus was $781 million consensus.

The company’s board boosted Oracle’s share buyback authorization by $15 billion.

In the quarter Oracle announced the availability of a Cloud Data Science Platform service and said former Infosys CEO Vishal Sikka was joining its board.

Societe Generale analysts led by Richard Nguyen upgraded its rating on Oracle stock to buy from hold in a note distributed to clients on March 4.

“In our view, Oracle’s execution capacity ranks among the best in the sector,” the analysts wrote. “In the past two recessions, the group successfully increased its margins thanks to its ability to cut costs rapidly.” They estimated that two-thirds of the company’s revenue comes in on a recurring basis, including through maintenance.

Oracle stock hit a 52-week low of $39.71 during Thursday’s session amid a wider market selloff as coronavirus continued to impact the economy. The stock had not traded at that level since January 2017. Notwithstanding the after-hours move, Oracle shares are now down 23% since the beginning of the year.

Executives will discuss the results and issue guidance on a conference call that starts at 5 p.m. Eastern time.

This is breaking news. Please check back for updates.

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