Just like many other large-cap techs -- such as Cisco and Hewlett-Packard -- Oracle's
Here's a look back at 2006.
Play-by-play
The fiscal third quarter was not a promising start to the calendar year. Net income was $765 million or $0.14 per share, which was up from $540 million or $0.10 per share in the same period a year ago. During this period, sales increased from $2.95 billion to $3.5 billion.
The big issue was the weakness in license revenue for the database business -- which increased only 4% to $827 million.
However, by the fiscal fourth quarter, things were much better. Net income was $1.3 billion or $0.24 per share, which was up from $1.02 billion or $0.20 per share in the same period a year ago. During this period, revenues increased from $3.88 billion to $4.85 billion, which was a pleasant surprise for investors.
The company indicated that its move into the business applications segment was getting lots of traction (there was also a better performance in the database business).
All of this set the stage for a blowout fiscal first quarter. Net income surged 29% to $670 million or $0.13 per share, with revenues up 30% to $3.59 billion. Oracle's license revenues -- from business applications -- were up a stunning 80%.
The company's brash CEO, Larry Ellison, engaged in some smack talk about his arch-enemy, SAP
The Foolish bottom line
Certainly, Oracle investors have nothing to complain about in 2006. The Motley Fool CAPS community is a bit more glum about things, however:
|
Oracle |
|
|---|---|
| CAPS Rating | ** (out of five stars) |
|
Total Bulls |
636 |
|
Total Bears |
73 |
|
Bull Ratio |
89% |
|
Bear Ratio |
11% |
Let's close things out with some analysis from CAPS player bmoneyAK:
"I think Larry Ellison is absolutely right that economies of scale are huge when it comes to enterprise software. I think growth through acquisition is a great strategy, so long as smart acquisitions are made. Most of the companies that Oracle acquires were founded by ex-Oracle employees or are somehow related, so there is not as much of a learning curve as critics think."
For further Foolishness:
Check out the other companies featured in "The Motley Fool's 2006 in Review and 2007 Preview" special.
If companies like Oracle excite you with their rule-breaking ways, you might be interested in our Rule Breakers newsletter, too. Our guide to the market's best iconoclasts is beating the S&P 500 by 7.9 percentage points, and a free 30-day trial is yours for the asking.
Fool contributor Tom Taulli does not own shares mentioned in this article. He is currently ranked 758 out of 17,523 in CAPS. The Fool has a disclosure policy.
