Oracle Corp. (ORCL, Financial) released its fourth-quarter results for fiscal 2021 after the market closed on June 15. The software company posted strong results, surpassing earnings and revenue expectations on the back of robust growth in the cloud business.
The company's shares fell 2.2% in after-hours trading to $79.85 per share following the earnings announcement.
By the numbers
The database giant registered adjusted earnings per share of $1.54, which edged past analysts' expectations of $1.31 per share. Revenue of $11.23 billion grew 8% on a year-over-year basis and surpassed projections of $11.04 billion.
For full-year fiscal 2021, revenue amounted to $40.5 billion compared to $39.07 billion in fiscal 2020. GAAP earnings were $13.7 billion, translating to $4.55 per diluted share. That compares with $10.14 billion, or $3.08 per share, recorded in 2020.
Reflecting on the company's performance, CEO Safra Catz said:
"Our multi-billion dollar Fusion and NetSuite cloud applications businesses saw dramatic increases in their already rapid revenue growth rates: Fusion ERP was up 30% in Q3 and up 46% in Q4, Fusion HCM was up 23% in Q3 and up 35% in Q4, NetSuite was up 24% in Q3 and up 26% in Q4. Oracle Fusion is the world's biggest cloud ERP business; Oracle NetSuite is the world's second biggest cloud ERP business. Revenue from our Gen2 Cloud Infrastructure business including Autonomous Database grew over 100% in Q4. The accelerating growth rates of both our applications and infrastructure cloud businesses this year drove earnings per share growth up to 21% in FY21.”
Segment performance
Cloud service and license support, which makes up roughly 75% of total revenue, surged 8% year over year to $7.4 billion. Analysts had called for revenue of $7.32 billion.
Cloud license and on-premise license sales grew 9% to $2.1 billion, while hardware revenue came in at $882 million (down 2%) and service revenue jumped 10.5% to $812 million.
Key developments
Last year, Oracle announced a partnership with web conferencing tool Zoom Video Communications Inc. (ZM, Financial). Zoom was in need of additional cloud capacity to manage the sudden surge in demand for its services. There was an unexpected spike of daily meeting participants to nearly 300 million. The company, therefore, opted for Oracle Cloud Infrastructure because of its superior cloud security and features, including scalability and reliability.
In addition, the company has been in talks to purchase TikTok's U.S., Canada, Australia and New Zealand operations from ByteDance, which is a Chinese multinational internet technology company. Microsoft Corp. (MSFT, Financial) is eyeing the TikTok deal as well.
The company recently rolled out the next generation of Oracle Exadata Cloud, which helps organizations speed up their most perplexing transaction processing and data analytics projects running in clouds as well as on-premises centers. In the third quarter, the company rolled out Oracle Database 21c, which is a multi-model and multi-workload database engine. It also launched a solid portable server for managing cloud workloads.
Financial targets
For the first quarter, the company anticipates adjusted earnings per share between $0.94 and $0.98. The revenue is expected to increase within the 3% to 5% range. Analysts were guiding for first quarter earnings of $1.03 and revenue growth of 3%. The ompany expect its first quarter earnings will be negatively impacted due to investment in its cloud business.
