Oracle's Guidance Disappoints

The business software giant said revenue grew 24% to $7.28 billion, from $5.88 billion in the same quarter of last year. Analysts polled by Thomson Reuters expected revenue of $6.86 billion.

The tremendous revenue beat was due in part to Oracle's exceptionally conservative guidance at the end of the prior quarter. Assumptions of low deal-closure rates turned out to be unnecessary, Catz said. The company's first-quarter guidance used "normal" rather than excessively conservative assumptions, she added.

Fourth-quarter revenue climbed 18.4% year over year to $3.6 billion in the Americas, 34.5% to $2.7 billion in Europe and the Middle East, and 20.5% to $986 million in Asia-Pacific. That region, which grew nearly 36% just two quarters ago, was slower than expected. CEO Larry Ellison said Oracle has since replaced the manager of its Japan office.

The bottom line rose to $2.04 billion, or 39 cents a share, from $1.6 billion, or 31 cents a share, in the year-ago period.

Excluding special items, EPS was 47 cents. Analysts were looking for 44 cents a share.

New software license revenue grew 27% year over year, or 20% in constant currency, to $3.1 billion. Software updates and support revenue grew 25%, or 18% in constant currency, to $2.8 billion.

Although analysts feared a tough quarter for new license sales of applications software, the category rose 31% year over year in constant currency, to $989 million. The category overall, including support and upgrades, took in $2 billion, up 24%.

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