Shares of Oracle Corp. (ORCL) soared 4.54% to $55.07 in after-hours trading on Wednesday after the company released financial results for the fourth quarter and entire fiscal 2019 year.
Non-GAAP earnings per share of $1.16 exceeded estimates by 8 cents, while GAAP earnings per share of $1.07 topped forecasts by 18 cents.
Non-GAAP earnings per share were 22.1% higher year-over-year, and GAAP earnings per share grew 35.4% from the prior-year quarter. Earnings were driven by rapid growth in Fusion and NetSuite (N), and by a shift to cloud applications from commodity hardware.
Revenue increased 1.2% to $11.14 billion, beating expectations by $210 million. The cloud services and license support segment contributed 61% or $6.8 billion in revenue, the cloud license and on-premise license segment 22.6% or $2.52 billion, the service segment 7.4% or $823 million and the hardware segment 8.9% or $994 million.
The cloud services and license support segment edged up 0.46%, the cloud license and on-premise license segment jumped 12.15%, the service segment declined 6.8% and the hardware segment went down 11.93%.
Additional fourth-quarter results were the achievement of a 4% increase in non-GAAP operating income to $5.3 billion for a non-GAAP operating margin of 47% versus the year-ago margin of 46%.
Oracle Corp. also reported the results for the full-year fiscal 2019. The most relevant were a 3% year-over-year increase in total revenue to $39.5 billion, 1.3% jump in non-GAAP operating income to $17.4 billion and flat non-GAAP operating margin of 44%.
Further, GAAP net income was $11.1 billion in full fiscal 2019 versus $3.6 billion in full fiscal 2018, while non-GAAP net income was $13.1 billion in full fiscal 2019 compared to $12.9 billion in full fiscal 2018.
“Our Fusion ERP and HCM cloud applications suite revenues grew 32% in FY19,” CEO Mark Hurd said in a statement. "Our NetSuite ERP cloud applications revenues also grew 32% this year. These strong results extend Oracle's already commanding lead in worldwide Cloud ERP. Our cloud applications businesses are growing faster than our competitors.”
The balance sheet had approximately $37.8 billion in cash and short-term securities, $56.2 billion in total notes payable and other borrowings and $8.4 billion in deferred revenues as of May 31. The equity was worth $22.36 billion.
In addition, on July 31 Oracle will, in line with the previous distribution, pay a 24-cent cash quarterly dividend per common share to shareholders of record July 17. The ex-dividend date is scheduled for July 16. Based on the share price of $52.68 at close Wednesday, the quarterly dividend determines a forward dividend yield of 1.81% versus an industry median of 1.79%. The company has paid dividends since May 2009.
The market capitalization was $180.04 billion at close on Wednesday. Following a 22% rise for the 52 weeks through June 19, the share price is above the 200-day simple moving average line but still below the 100- and 50-day simple moving average lines. The 52-week range is $42.40 to $55.53.
For sell-side analysts, shares of Oracle should be held. These analysts have also have an average price target for Oracle of $54.29, or 3.06% higher than Wednesday’s closing price.
Disclosure: I have no position in any securities mentioned.
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