The 10-second takeaway
For the quarter ended Feb. 28 (Q3), Oracle missed estimates on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue dropped slightly. Non-GAAP earnings per share grew. GAAP earnings per share increased.
Gross margins grew, operating margins dropped, net margins grew.
Oracle logged revenue of $8.97 billion. The 31 analysts polled by S&P Capital IQ predicted net sales of $9.37 billion on the same basis. GAAP reported sales were the same as the prior-year quarter's.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.65. The 36 earnings estimates compiled by S&P Capital IQ averaged $0.66 per share. Non-GAAP EPS of $0.65 for Q3 were 4.8% higher than the prior-year quarter's $0.62 per share. GAAP EPS of $0.52 for Q3 were 6.1% higher than the prior-year quarter's $0.49 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 80.8%, 190 basis points better than the prior-year quarter. Operating margin was 37.7%, 10 basis points worse than the prior-year quarter. Net margin was 28.0%, 40 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $11.15 billion. On the bottom line, the average EPS estimate is $0.88.
Next year's average estimate for revenue is $37.44 billion. The average EPS estimate is $2.68.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 3,451 members out of 3,664 rating the stock outperform, and 213 members rating it underperform. Among 810 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 776 give Oracle a green thumbs-up, and 34 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Oracle is outperform, with an average price target of $37.55.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Oracle. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.