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Oracle’s Revenue Misses Estimates

September 15, 2016

Key Speakers At The Oracle OpenWorld 2014 ConferenceKey Speakers At The Oracle OpenWorld 2014 Conference
Larry Ellison, executive chairman of Oracle Corp. Bloomberg Bloomberg via Getty Images

(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 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.