Oracle Surges Despite Revenue Miss

JMP Securities lowered its Oracle earnings estimate for fiscal 2009 from $1.47 to $1.45. On average, analysts are calling for $1.46.

Despite the challenges facing his company, Oracle CEO Larry Ellison struck a typically aggressive tone during a conference call late Thursday.

"We believe that we're at least the size of IBM (IBM Quote), or we may have passed them [in middleware software sales]," he said.

Oracle, which claims to be growing its middleware sales at four to five times faster than IBM's WebSphere business, reeled off a long list of companies using its Fusion software during the conference call, including Raytheon(RTN Quote), Toshiba, the German Federal Employment Office and Spanish telecom giant Telefonica(TEF Quote).

Ellison also fired a shot across the bow of software rival Salesforce.com(CRM Quote), claiming that his firm is boosting its presence in sales of on-demand software.

"When we compete head-to-head with Salesforce.com, we win more deals than we lose, and that's new in the last couple of quarters," he said.

Ellison admitted, however, that it is still early days for the firm's "database machine," a prepackaged mix of Oracle software and Hewlett-Packard(HPQ Quote) hardware.

"We think it going to be a while before we are able to convert this pipeline," he said. "That business looks very, very promising, and should help us convert growth over the next 18 months."

The Oracle CEO also briefly discussed the firm's M&A agenda, explaining that there are plenty of bargains in an economic downturn.

"Some companies have much more attractive valuations right now, but I'm not sure that they would be wildly enthusiastic about being selling for cash at this point in time," he said, in response to an analyst's question.

Oracle, which has $10.6 billion in cash and investments, is certainly on the lookout for deals, according to Ellison, who did not reveal the identities of the firm's targets.

"We're looking at a number of small acquisitions in the vertical areas and some potential opportunities for a large company acquisition if the price is right," he said.