Updated from 10:18 a.m. to include thoughts from MKM Partners analyst.
For the third quarter, Oracle earned 68 cents a share on $9.3 billion, coming in below what analysts were expecting. Analysts surveyed by Thomson Reuters were expecting 70 cents a share on $9.36 billion. The company did note in its press release that currency fluctuations impacted earnings by 3 cents a share, with 2 cents coming from the wild swings in Venezuela.
"In constant currency, our Cloud Software Subscriptions revenues grew 25% and our Engineered Systems revenue grew more than 30% in the quarter," said Oracle President and CFO Safra Catz in the press release. "Oracle Cloud Applications and Engineered Systems are both rapidly growing, billion dollar run-rate businesses. Those two high-growth businesses helped us deliver record year-to-date operating cash flow, and a record $15 billion of operating cash flow over the past twelve months."
Shares were higher in Wednesday trading, having reversed course from earlier in the session, gaining 0.12% to $38.91.
CEO Larry Ellison lauded the company's hardware portfolio, noting Exadata and SPARC SuperClusters had over a 30% constant currency growth rate during the quarter. "Our Engineered Systems business is growing rapidly for the same fundamental reason that our Cloud Applications business is growing rapidly. In both cases, customers want us to integrate the hardware and software and make it work together, so they don't have to."