Investors will be watching for news about Oracle's Exadata database machine, a prepackaged mix of hardware and software used for data-intensive projects like cloud computing and grids, or large clusters of servers and storage used in industries such as oil exploration.
"Our field work validates the disruptive potential of Exadata," said Brad Zelnick, an analyst at Macquarie Securities, in a note released Thursday. "We are upgrading Oracle from neutral to outperform given our view that Exadata momentum is accelerating at the expense of other providers in the ecosystem, like IBM and HP."Analysts surveyed by Thomson Reuters expect Oracle to report revenue of $8.34 billion and earnings of 46 cents a share, compared to $5.9 billion and 39 cents a share in the same period last year. This time last year, however, Oracle was duking it out with the European Commission amid antitrust concerns over its $7.4 billion acquisition of Sun. The tech giant completed its Sun merger in January and has been confounding the critics who said that the deal was a bad move. During its recent first quarter, Oracle said that its hardware business grew faster than anticipated, driven by Sun's Solaris servers and Exadata. "We believe most of the Sun integration risk has abated as we approach the anniversary of this transaction," said Macquarie's Zelnick. "We still maintain that Oracle faces budget concentration risks as Sun increased the overall revenue base of the company by nearly 50% and therefore represents an increasing percentage of customer wallet share." Oracle, which recently won $1.3 billion in software theft-related damages from rival SAP (SAP), may also shed more light on its M&A strategy after market close on Thursday. Ellison has been on an acquisition tear in recent years, spending big money on PeopleSoft, BEA Systems, Sun and most recently, e-commerce specialist ATG. The Oracle chief has voiced his desire to purchase a chip company, prompting speculation that Broadcom (BRCM) , Marvell (MRVL) or even AMD (AND) could make attractive targets. Oracle shares rose 0 cents, or 0.30%, to $30.58 Thursday despite a modest dip in tech stocks that saw the Nasdaq slip 0.46%. --Written by James Rogers in New York. >To follow the writer on Twitter, go to http://twitter.com/jamesjrogers. >To submit a news tip, send an email to: email@example.com.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV