Oracle Corp. (ORCL) - Get Report shares traded sharply lower Thursday after the business software group posted weaker-than-expected first quarter sales and said CEO Mark Hurd would be taking a medical leave of absence.

Oracle said adjusted earnings for the three months ending in August, the first quarter of the company's 2020 fiscal year, came in at 81 cents per share, up 14% from the same period last year and essentially matching the Street consensus forecast. Group revenues, however, were modestly shy of analysts' estimates at $9.22 billion as licencing revenues fell 6% from the previous year. Cloud and support revenues, however, rose 3% to $6.8 billion. 

Oracle also said Hurd, 62, will take a leave of absence from the Redwood City, California-based group for "health related reasons" that the company did not disclose. His duties will be assumed by co-CEO Safra Ada Catz as well as founder and chief technical officer Larry Ellison.

"Mark was extremely engaged with the business through the end of the quarter, but now he needs to focus on his health and taking care of himself," Catz told investors on a conference call late Wednesday. "As the three of us have always worked as a team on managing Oracle, Larry and I will cover Mark's responsibilities during his absence with support from the rest of our strong management team."

"The only weakness we had, and it was simply just a slow start as we reorg-ed the North America tech sales force since we split it," Catz explained when asked about the licencing weakness. "So there's no macro issue. There's no actual regular issue. And of course, the thing is that in Q1, small numbers make a big difference, and so they just kind of outsized."

Oracle shares were marked 5.35% lower at the start of trading Thursday to change hands at $53.08 each, a move that would still leave the stock with a year-to-date gain of around 22%.

Looking into the 2020 fiscal year, Oracle said it sees second quarter earnings in the region of 87 to 89 cents per share, just shy of the Refinitiv consensus of 91 cents per share, but still expects double-digit EPS growth for the full year. 

Second quarter revenues are expected to grow between 1% and 3% from last year, the company said, with capex pegged at around £2.2 billion.

Oracle's business trends downticked in F1Q as EPS was in line while total revenue missed consensus estimate by ~1%. Positively, the metrics and management commentary remain solid for the financials and autonomous database cycles," said Oppenheimer analyst Brian Schwartz. "Additionally, management announced a new $15B buyback authorization, which lends support to achieving the annual EPS target and the valuation amidst rising fears of an execution slip from Oracle's high international exposure (~45% of revs) and with the Co-CEO's temporary absence looming."