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September 16, 2016updated 21 Sep 2016 2:52pm

Software stagnates for Oracle as cloud flourishes

Company reports its Q1 2017 financial results.

By James Nunns

A week before Oracle hosts its Open World conference in San Francisco and the company just got given some new questions to answer.

In the company’s Q1 2017 financial results it reported revenues of $8.6bn, up 2% from the same quarter a year ago, net income stood at $1.8bn up 5% for the year-ago quarter.

The biggest boost for the company came from revenues in SaaS and PaaS where a 77% rise was seen on the quarter bringing revenue for the two areas to $798m. On the whole the company’s cloud efforts brought in $969m in revenue.

While this is unquestionably good news for Big Red, it may not ease the concerns about declining on-premise software.

While on-prem software is the company’s big earner and brought in $5.8bn in revenues, this was flat on the year-ago quarter and new software licenses were down 11%.

Hardware revenues also fell, down 12% on the quarter, hardware product revenues fell 19% and support revenues by 4%.

Cloud continues to be a healthy point of growth for Oracle and the company believes that it is on track to sell more than $2bn of SaaS and PaaS this year under annually recurring revenue, said Mark Hurd, Oracle’s co-CEO.

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“We believe this will be the second year in a row that Oracle has sold more SaaS and PaaS than any cloud services provider,” said Hurd.

Despite this cloud positive the company cut its earnings forecast for the current quarter. Safra Catz, co-CEO, Oracle, said that the company would cut six cents per share in the current quarter (Q2 2017). This is due to tax and currency factors and the costs of a recent debt issue, the FT said.

Brexit had a direct impact on the company, Catz said that it had wiped 1% from profits and revenues for the latest period.

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