On June 26, database and middleware giant Oracle (NASDAQ:ORCL) released fourth-quarter earnings for the period ended May 31, 2007.

  • Oracle posted impressive growth for such a large company, structured just the way a Fool would want it. The company snared big revenue gains, a bigger operational boost, even more juice in the net profits --¬†and then again, after accounting for share buybacks --¬†capped off with the largest gains of all in various cash flows. Very nice.

  • However, it's unclear how much of the growth is organic, and how much came from the $5 billion Oracle spent on acquisitions over the past year.

  • That's a minor quibble, though. Oracle knows that its acquisition-based growth strategy is unusual and controversial, and it's prepared to defend its tactics to the bitter end. Take that, IBM (NYSE:IBM) and SAP AG (NYSE:SAP)!

(Figures in millions, except per-share data)

Income Statement Highlights

Q4 2007

Q4 2006

Change

Sales

$5,828

$4,851

20.1%

Net Profit

$1,604

$1,300

23.4%

EPS

$0.31

$0.24

29.2%

Diluted Shares

5,224

5,373

(2.8%)

Get back to basics with the income statement.

Margin Checkup

Q4 2007

Q4 2006

Change*

Gross Margin

80.2%

80.1%

0.0

Operating Margin

39.1%

38.3%

0.9

Net Margin

27.5%

26.8%

0.7

*Expressed in percentage points.

Margins are the earnings engine.

Balance Sheet Highlights

Assets

Q4 2007

Q4 2006

Change

Cash + ST Invest.

$7,020

$7,605

(7.7%)

Accounts Rec.

$4,074

$3,022

34.8%

Liabilities

Q4 2007

Q4 2006

Change

Accounts Payable

$315

$268

17.5%

Long-Term Debt

$6,235

$5,735

8.7%

The balance sheet reflects the company's health.

Cash Flow Highlights

Q4 2007

Q4 2006

Change

Cash From Ops.

$2,215

$1,679

31.9%

Capital Expenditures

$136

$75

81.3%

Free Cash Flow

$2,079

$1,604

29.6%

Owner Earnings

$2,140

$1,537

39.2%

Free cash flow is a Fool's best friend.

Related Foolishness:

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

At the time of publication, Anders Bylund had no position in any company mentioned. Fool rules are here.