(Reuters) – Oracle reported lower-than-expected quarterly revenue as growth in its cloud-based offerings failed to make up for weakness in its traditional software licensing business.

Sales of Oracle’s cloud software and platform as services rose 77% to $798 million, while sales of its new software licenses fell 10.5% to $1.03 billion.

The company in July agreed to buy NetSuite n for $9.3 billion to better compete with nimbler rivals such as Workday Inc and Salesforce.com Inc that specialize in cloud-based offerings.

Oracle’s net income rose to $1.83 billion, or 43 cents per share, in the first quarter ended Aug. 31 from $1.75 billion, or 40 cents per share, a year earlier.

Excluding items, Oracle earned 55 cents per share.

Total revenue edged up 1.7% to $8.6 billion.

Analysts on average had expected quarterly revenue of $8.7 billion and a profit of 58 cents per share, according to Thomson Reuters I/B/E/S.

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Oracle’s shares orcl fell 1.1% to $40.40 in extended trading on Thursday.